Nicosia - Disy is ready to take the initiative to cut property tax if the government does not do soon, chairman Averof Neophytou said yesterday.
Property tax has proven to be one of the most divisive aspects of Troika-imposed tax measures aimed at generating much needed revenue for the cash strapped government.
Last Thursday, parliament approved amendments lightening the load on small property holders.
It also endorsed the government’s amendment scrapping a €75 minimum tax.
The change raised the tax exempt threshold from the €5000 value of property at 1980 prices that was proposed by the government to €12,500. This meant tax exemption for 52,000 property owners, in addition to the 96,000 owners that would have been exempted under the government’s proposal.
This translates into a revenue loss of €12.7m for the state.
Under the bailout programme, the government needs to raise €100m from property tax but has so far only collected 10% as tax payers held out for last minute changes by parliament.
Neophytou said that his party would come up with proposals, adding that any loss in revenue for the state from lower taxes must be matched by a cut in expenditure.
“In the initial memorandum that it submitted in July 2012, the Troika proposed an increase in property tax by an additional €20 million. The government of the time counter-proposed additional revenue of €69m as its philosophy was to raise taxes rather than cut spending,” he said.
Neophytou added that in run up to February’s presidential elections all the parties and candidates had pledged to re-hire 982 contract workers who had been dismissed, without raising teachers’ hours by one.
The Anastasiades government had covered this extra cost from the property tax and an additional contribution from public servants, he added.