Speaking to the press after the session, deputy government spokesman Victoras Papadopoulos said that for all other properties, valued in excess of €200,000, the tax levy would be reduced to 0.1%.

Current legislation calculated property tax using 1980 valuations, levying a tiered tax from 6 to 19%, depending on value brackets. Revised property values to reflect 2013 prices have now been established, meaning the government can afford to adjust tax brackets accordingly.

“Previous legislation exempted 40% of property owners, whereas this year 54% will be exempted,” Papadopoulos said.

“Following the updating of the total tax base and the valuation of all properties with 2013 prices, the government can drastically reduce tax coefficients and increase tax-exemption brackets without impacting revenue targets relative to 2013,” he added.

“For this reason, the Council of Ministers approved a bill proposing the exemption of property valued up to €200,000 from property tax. For all other properties, valued in excess of €200,000, the tax coefficient applicable is reduced to 0.1%.”

Papadopoulos added: “In the same spirit, the Council of Ministers approved a bill amending the Municipalities Law, so that municipalities can afford to adjust the tax coefficient on municipal fees for immovable property from 0.15% to 0.022%, in order to fall in line with the Land Registry’s 2013 prices.”

Asked to explain how the tax base had been broadened, he said updating values and prices and recording all properties that had not been registered – and thus were not taxed – will now be subject to taxation.

“Therefore, the tax base can now be broadened, and the tax-exempt base can also be broadened – from 40% to 54%,” he said.

The government was also looking into reducing transfer fees by 50% to help clear a backlog of some 28,000 applications for title deeds.

Interior Minister Socratis Hasikos said the cabinet was close to approving the change but noted that it would be a temporary arrangement.

On the one hand the reduction to transfer fees will help people get their title deeds… on the other there will be income for the state,” he told state radio. This would also help in clearing a backlog of 28,000 applications. The arrangement will be in place for one or one and a half years, the minister said. Clearing the backlog is part of the island’s bailout terms. Cyprus must cut down the number to around 2,000 by the end of the year.

Also yesterday, the Cabinet approved a bill that aims at resolving aging problems relating to demarcation and development of jointly owned, unallocated and enclosed housing plots.

Papadopoulos said that the bill also simplified the process of examining town-planning amnesty applications, and reduces the 30% offset cost payable by applicants who have exceeded the total area allowed by the building permit.

Asked to elaborate on the bill’s provisions, Papadopoulos said that until now, in case a plot of land was owned by two or more people, if at least one did not consent to its development or demarcation nothing could be done.

“The new bill will allow demarcation given the consent of 60% of the owners,” he said. Papadopoulos added that the bill would address issues relating to roads and passageways for enclosed plots.

“If the owners of a plot surrounding an enclosed plot do not consent to demarcation, the Land Registry head will be allowed to examine the applicant’s request to build a road and develop the property,” he said.

Source: Cyprus Mail