Plan to charge for tax certificates

TAX certifications issued by the Inland Revenue Department are costing Cypriot taxpayers thousands every year, prompting the Finance Ministry to request a law alteration to cover the added costs.

Presenting the relevant bill to the House Finance Committee yesterday, the Director of Finance from the Directorate of Tax Policy and Implementation, Phedonas Kalozois, explained that tax certifications – issued mainly to people who come from abroad to prove their taxing station is in Cyprus – are currently provided without any costs for the applicant. The public sector, in contrast, has to put in the manpower and take on the costs of managing as well as issuing the applications.

According to Kalozois, more than 27,000 certifications were issued in 2007 alone. “We estimate that around 100 such certifications are issued on a daily basis, which burdens the rest of the Cyprus state’s taxpayers, as no duties are collected for these services,” said Kalozois, adding that this is not the case in other states.

With the aim of covering these added costs, he continued, the Finance Ministry is suggesting the addition of a new chapter in taxing laws, empowering the Cabinet to set a duty for issuing the certifications.

The bill was met with a variety of reactions by the parliamentary parties, which prompted Committee Chairman Antigoni Papadopoulou of DIKO to request an explanatory letter by Finance Minister Charilaos Stavrakis to analyse the bill, before it is sent to the Plenum for approval.

“These duties will be imposed to alleviate the administrative costs,” Papadopoulou explained after the meeting.

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