Another property tax | Cyprus Gazette

11 December 2023 Cyprus's new property taxation, which was introduced in 2021, came into effect. However, due to an error in the house, the tax didn't kick in until 2022.

This is a 0.4 percent tax on the sale price of the property and must be paid by the seller. Real estate, in my opinion, is taxed too high and this is an easy way for any government to increase taxes because there is no easy way to avoid this property tax.

A property tax is not justified at this time, even if the rationale for this tax is that the funds collected will be used to compensate property owners in the north.

The law states that the declared sale price must be taken into account, and/or the assessed value according to the cadastre. Due to a procedural mischief in the House, there is some confusion as to when the tax applies. According to the information available to me, the IRS considers the date of sale to be the date of transfer, even though the original sale occurred several years ago, and therefore should be exempt from this tax.

The tax itself is not particularly high in and of itself, but considering all the other taxes associated with real estate, it adds to the overall burden. This is particularly important for developers, who are likely to pass this tax onto the buyer to recover their costs.

The idea of taxing sellers, who MPs believe have benefited significantly from the Turkish invasion, seems to ignore the fact that the seller ultimately passes this tax onto the buyer. This is particularly important at a time when the government is trying to introduce measures to curb the rise in real estate and especially housing prices.

The taxation of real estate starts with a value-added tax (VAT) of 5 or 19 percent, depending on whether the property is for personal use.

Where does this end? Should this be extended to other refugee losses such as loss of businesses, cars, etc. д.? Should this be applied to goods and any household items, not just real estate? This is a confusing situation that cannot be easily resolved and will lead to various problems.