Cabinet Plans Measures to Ease Cost-of-Living Pressures

Government Deliberates on Cost-of-Living Relief Measures

In a move to address the escalating cost-of-living pressures, the Cabinet is convening an extraordinary session this Thursday. The primary agenda is to deliberate and endorse a new package of measures to alleviate the cost-of-living crisis. This decision has been prompted by the impending cessation of the fuel tax subsidy, a temporary relief that Finance Minister Keravnos has confirmed will not continue beyond the upcoming Monday.

Despite the fuel tax subsidy coming to an end, there is a silver lining for residents grappling with high energy costs. The Cyprus News Agency (CNA) reports that the government is contemplating an extension of the electricity subsidy until the end of June. Initially rolled out in October and extended in February through April 30, the subsidy initially offered approximately €70 off per bimonthly bill for average consumers. However, with recent dips in oil prices, the value of this subsidy has diminished to around a €14 reduction for the average consumer.

Alongside energy subsidies, the Cabinet is also considering prolonging the suspension of VAT on essential goods until the end of June. This measure, which zeroes out VAT on a range of staple products, was previously extended through May. The list includes necessities such as meat, fish, vegetables, bread, milk, eggs, baby food, nappies, feminine hygiene products, and adult incontinence underwear. Finance Minister Keravnos highlighted earlier this month that this initiative has provided “significant benefits for consumers,” estimating an average saving of about €7.50 on purchases worth €95.

Furthermore, there is a discussion around the possibility of extending various social welfare measures that were initially implemented in February. These measures were designed to support vulnerable groups within society, including single-parent families and internally displaced persons, offering them financial aid during these challenging economic times.

The government’s proactive stance in extending these measures reflects an ongoing commitment to cushion citizens from the brunt of economic hardships. As households across the nation await the outcome of Thursday’s meeting, many hope for continued support in navigating through these financially strenuous times.

The Cabinet is exploring several strategies, including tax relief for low-income families, incentives for energy-efficient home upgrades, and possible subsidies for essential goods. These measures aim to alleviate the burden and boost economic resilience amid the cost-of-living crisis.

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