Gold Magazine February - March 2013, Issue 23 | Page 94

new legislation
Troika
Measures

{TAX&LEGAL}

I

n view of the Memorandum
of Understanding between the
Republic of Cyprus and the
Troika (the European Commission, the International Monetary
Fund and the European Central
Bank) for financial assistance,
the House of Representatives was particularly active at the end of 2012, approving
no fewer than 25 new or amended laws
with the aim of meeting targets agreed with
the Troika. There are number of new laws
which effect both local and international
investors and businesses.

Companies Law Cap 113 –
Annual Levy of €350

According to the Companies Law Cap 113,
it is compulsory for all companies registered
with the Company Registrar to pay the annual
fee of €350.The amendment extends the
application of the existing annual fee to include
dormant companies.

Carrying Forward of Tax Losses
Tax losses will no longer be able to be carried
forward indefinitely and all legal persons who
have the obligation to prepare audited financial
statements will now be able to carry forward
tax losses only for a period of five years.

Provisional Tax Returns

The dates for filing provisional tax returns
have been amended. Returns are now required
to be submitted prior to 31 July (instead of 1
August) and provisional tax payments are to
be made in two instalments instead of three,
the first being on 31 July and the second on 31
December, effective from January 1 2013.

Social Insurance

Various amendments have been made to the
Social Insurances Law including an increase in
contributions of 1% for both employers and
employees resulting to a total contribution of
7.8% each from 2014 a nd the gradual increase of the retirement age from 63 to 65 (six
months per year). In addition, the maximum
amount of insured emoluments has been raised
to €54,396 (€1,046 for weekly paid employees and €4,533for monthly paid employees).
The aforementioned change is to be applied
from the first payroll of the year 2013.

and the debate was adjourned. The matter
has already been discussed during a number
of various parliamentary sessions. Interior
Minister Eleni Mavrou said at the end of
the year that the bill would not now update
property values using the Consumer Price
Index (CPI) to 2012. Instead, there will be
no change in the way immovable property tax
is currently calculated, which is based on the
property’s value on January 1, 1980.

VAT

As of January 14 2013, the standard VAT
increased from 17% to 18% and will subsequently be raised to 19% as of January 13,
2014. In addition, the reduced VAT rate of
8% will rise to 9% on January 13 2014.

OTHER AMENDMENTS TO LAWS

An immediate increase in purchase tax was
introduced on petroleum products, tobacco
and alcohol products, excluding wine.
A special law on administrative cooperation
for the exchange of information between EU
member states for the collection of taxes was
passed. The special temporary contribution
paid by employees, pensioners, self-employed,
government and semi-government officials
was extended for another three years until 31
December 2016.

Immovable Property Tax

In December the House of Representatives
also engaged in discussions on a bill concerning the imposition of tax on immovable property. However, it failed to reach consensus

Laws Amended
to Comply with
Troika Measures

BOOK
REVIEW
TAP DANCING TO WORK:
WARREN BUFFETT
ON PRACTICALLY
EVERYTHING, 1966-2012
BY CAROL LOOMIS (PORTFOLIO PENGUIN, 2012)
RRP: £20.00 (£12.80 FROM AMAZON.CO.UK)

C

arol Loomis has written
about Warren Buffett since
1966 when she penned the
first mention of his name for
Fortune magazine where she still works.
For the past 35 years she has edited
Buffett’s eagerly-awaited annual letter to
the shareholders of Berkshire-Hathaway.
This book draws from decades of
articles, editorials, and interviews to
highlight Buffett’s belief that “a good
business is run and a good life is led.”
The man who was so happy with his lot
that he went ‘tap dancing to work’ has
consistently advised that it is best to buy
“things that make more things” rather
than gold or other commodities and he
prefers investments that do not involve
high technology (admitting that he’s not
so knowledgeable in that area), that serve
a strong demand, are well-managed,
bring in strong financial returns, have
minimal capital requirements and low
debt, and are protected by a strong
‘moat’ that provides a sustainable
competitive advantage. This is essentially
a fine biography of one of the world’s
richest and most fascinating people.

92 Gold THE INTERNATIONAL INVESTMENT, FINANCE & PROFESSIONAL SERVICES MAGAZINE OF CYPRUS

tax_troika & on the rise.indd 92

01/02/2013 12:42