Archive for December, 2018

Deputy Ministry of Shipping – Cyprus

In recent years, efforts have been made to upgrade and further develop the maritime industry of Cyprus.

When the Deputy Ministry of Shipping begun its operation, 168 companies were registered under the Cyprus tonnage tax system while today it has risen up to 191 companies in total.

The Deputy Minister of Shipping, Ms. Natasa Pilides stated that attempts are being made to simplify the procedures and modernize legislation so as to make Cyprus more competitive as a Register and as a maritime cluster. She also highlighted that attempts are being made to digitalize and modernize the Cyprus systems in order to make the Cyprus Registry even more attractive.

The budget of the Deputy Ministry for the year 2019 is 9.8 million euro compared to 8.1 million euros for the year 2018, i.e. an increase of 1.7 million euros. This is due to the large increase in the budget expenditure growth which is mainly because of the commercial shipping promotion and development activities.

The Deputy Ministry’s revenue for the year 2018 is estimated around 12 million euro while the indirect incomes of the maritime industry is estimated at 800 million euros which amounts to 7% of the GDP of the island. According to Ms. Pilidou, there are currently around 1100 seagoing ships and 600-700 small vessels under the Cypriot flag.

Based on these facts it is evident that the maritime industry of Cyprus is gradually evolving. The shipping fleet of Cyprus is the 10th largest worldwide and has 25% of the whole EU fleet. By continuously updating its services and striving for perfection in the field of shipping it will not be a surprise if Cyprus conquers the top in the near future.

Legal Update: Amendments to the Greek Tax Legislation

On 28/11/2018, the Greek Parliament voted important amendments to the Greek tax legislation such as the reduction of the property tax for the year 2019 for certain owners of real estate in Greece as well as a gradual decrease of the Greek corporate income tax.

More specifically, with a view to encourage investments and improve competitiveness of businesses, article 58 of the Greek Income Tax Code is amended so as to gradually decrease the tax rate applicable to profits from business activity of corporate entities from 29% (corporate income tax rate applicable today) to 25% for income earned as of the financial year 2022 and the following years.

As such, the Greek corporate income tax rate shall be reduced by 1% per year, applicable as of the income of the financial year 2019. Thus the income of the financial year 2019 shall be subject to a rate of 28%. Accordingly, for 2020 the tax rate shall be 27% and for 2021 the tax rate shall be 26%.

The Parliament, aiming to provide relief to the tax payers who are owners of low value real estate in Greece, further voted a decrease of the Greek property tax (ENFIA) for the year 2019.

According to the amendment introduced, specifically for the year 2019, when the total value of the real estate property held by a natural person which is subject to property tax, is up to the amount of 60 000 euros, the corresponding property tax shall be reduced by 30%. When the total value of the said real estate exceeds the amount of 60 000 euros, for the excess thereof, the amount of reduction of the tax (30%) shall be reduced by 0.7 euros per 1000 euros of the real estate and may not exceed 100 euros.