The Tax Department has found violations at 60% of more than 100 businesses inspected in Cyprus’s main coastal tourist areas, as authorities step up efforts to tackle tax evasion during the summer season.
Checks focused on sea sports and boat excursion operators, souvenir shops and catering businesses in Paphos, Ayia Napa, Protaras and Larnaca.
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Surprise Checks Find Receipt Violations
More than 100 unannounced inspections were carried out over the past two weeks, with 60 businesses found not to have issued receipts after selling goods or providing services.
Inspectors also found cases where receipts did not match the actual transaction value. Some businesses reportedly refused card payments for small purchases or accepted cash only, making it easier to conceal income.
The inspections are part of a business-sealing measure introduced last June and intensified during the peak tourist period.
Businesses Given Time To Comply
Businesses that break the rules initially receive a warning and 15 days to comply. A second warning provides another 15 days, followed by a final five-day deadline.
Failure to comply can lead to the premises being sealed. The Tax Commissioner can lift the seal once the business meets the requirements and receives a compliance certificate, while continued violations can result in closure for up to 20 days.
Follow-up checks have already shown that businesses previously found in violation changed their practices and began issuing receipts and accepting card payments.
Major Tax Debtors Next
The crackdown will now expand to businesses with tax debts exceeding €20,000. Authorities have identified around 500 businesses owing more than €1 million in taxes, with enforcement action expected in the coming weeks.
From January 1, 2027, the sealing measure will also cover failures to submit tax returns, VAT returns and tax and contribution withholding declarations.
Taxpayers have been given a year to settle outstanding liabilities and file overdue returns.
