To provide clarity: neither the proposed catalogue of measures by the troika nor the counterproposals of the Cypriot government contain an increase of the corporate tax rate, and no new relevant taxes are planned (no capital gains tax on company income, no withholding tax).

Therefore, there are currently no disadvantagous tax-related changes to be expected.

The majority of proposals in the catalogue of measures consists of structural changes and improvement of administrative affairs as well as salary cuts for civil servants, employees in the public sector and taxation of extended benefits relating to salaries.

Futhermore, an increase is planned of social security contributions of civil servants and employees in the public sector. Moreover, the VAT rate is planned to be increased from 17 to 18%.

A concrete date of implementation is currently not yet foreseeable. At the moment, Cyprus has presented counter proposals to the troika and negotiations are on-going behind closed doors and through telecommunication.