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Providing incentives and enhancing competitiveness

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Providing incentives and enhancing competitiveness

Providing incentives for an external economy is legitimate, of course, within the framework of the Constitution and its laws, European Directives and internationally accepted practices. The presence of a control and accountability mechanism regarding their implementation as well as the assessment of the impact on the economy is imperative. The latter is important in order to make corrective actions in cases of distortions, injustices and problems in general in their implementation.

In addition, a key criterion for the success of any measures is to maintain the country's competitiveness and to take into account the conditions prevailing in the international political and economic environment. It is also necessary for the state to listen to the needs of entrepreneurs and society in the formulation of any measures and proposals.

A typical example of proper and structured development of an economic sector is that of investment funds. With almost no international presence ten years ago, Cyprus currently has assets under management in excess of ten billion euros.

The legislative frameworks of other countries, the needs of investors, managers and other professionals that make up the industry were analyzed through systematic work and through the cooperation of all private and public sector bodies, a strong and competitive institutional framework was created.

The same can be seen for other sectors, such as shipping, which is one of the main and stable blood donors of the Cypriot GDP. A sector full of challenges and great competition, but Cyprus manages to remain a strong shipping center.

A series of measures / incentives was announced to attract or even strengthen the existing activities of companies in Cyprus, with technology companies gaining momentum (we have recently seen technology companies open offices in Cyprus, with a recent example a company specializing in technology services for financial and related institutions) and the industry to be organized.

The measures include the transformation of the existing Mechanism for the Rapid Activity of International Companies into a Business Facilitation Unit operating or wishing to operate in Cyprus in order to simplify the registration procedures in the competent departments but to ensure and the issuance and renewal of residence and employment permits.

In addition, the policy for the employment of highly skilled third-country nationals is being restructured, with an emphasis on foreign-owned companies operating in the Republic of Cyprus or foreign-owned companies intending to operate in the Republic of Cyprus and operating independent offices in Cyprus, Cypriot companies. Cypriot high-tech / innovation companies and Cypriot pharmaceutical companies or Cypriot companies active in the fields of biogenetics and biotechnology.

It is also noted that one of the issues that arose earlier was resolved where the spouses of people who came to Cyprus to be employed could not work for fear of occupying positions that could be filled by permanent residents. Now they will be able to work but with a minimum wage of 2,500 euros, so as not to affect employment (of course at this time there are sectors with large shortages in terms of human resources).

The process of granting work permits (Category E – Long-term resident status) is also simplified and accelerated, ie those whose employment will not lead to the creation of unjustified competition in the profession in which they will practice, the Digital Nomad visa is introduced with a maximum number of one hundred people .

As for the employees who come to the Republic for the first time and become tax residents, today they are entitled to an exemption of 50% of their salary from taxation if the annual earnings are at least 100,000 euros. According to the measures announced, the tax exemption of 50% to new residents-employees will be applied if the annual remuneration from employment is at least € 55,000. Existing beneficiaries of the measure should be able to extend the benefit from 10 to 17 years.

As for the right to apply for naturalization, this can be done after 5 years of residence and work in the Republic (creating inseparable ties with the country and contributing to society and state funds such as that of Social Security), instead of the current 7 today or after 4 years if they meet the criterion of having a recognized certificate of very good knowledge of the Greek language.

It is understood that attracting businesses, executives and high-income workers is expected to help the economy as a whole and all sectors, such as construction and real estate, consumption, restaurants, education and more.

Source: politis.com.cy

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