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Cultural VAT Clarification: Redefining Combined Event And Catering Charges

Clear Guidelines For A Changing Landscape

The Tax Department has issued a decisive circular that streamlines the application of VAT on cultural events. Circular 6/2025, signed by Tax Commissioner Sotiris Markidis at the beginning of October, endeavors to eliminate inconsistencies and prevent overcharging by clarifying when VAT should be applied on entry to concerts, performances, exhibitions, and other cultural gatherings—especially when admission includes food or drink.

Simplified VAT For Pure Event Admissions

The new directive stipulates that a 5 per cent VAT rate is applicable to admission tickets for concerts, theatrical performances, fairs, circuses, amusement parks, museums, zoos, cinemas, and similar events, provided that catering services are not included. For instance, a concert held in any venue—from a traditional theater to an unconventional beach setup—will only incur the reduced rate if no food or drink is offered with the ticket.

Composite Transactions And The Impact On Pricing

Events where admission is bundled with food, drink, or other catering services are subject to a higher VAT rate of 9 per cent. This classification applies even when the consumer opts not to fully utilize the added amenities. Whether it is a Sunday lunch accompanied by live music or a dinner show featuring a notable performer, the entire package is taxed at the higher rate if catering forms a substantial component of the offer.

Guidance On Separate And Combined Charges

The circular further clarifies that if an event organizer charges separately for admission and catering, each component retains its respective VAT rate—5 per cent for entry and 9 per cent for catering. Moreover, optional and distinctly priced catering allows the reduced rate on the admission ticket to remain unaffected, ensuring equitable treatment for both consumers and organizers.

Special Provisions For Premier Performances And Cultural Organizations

A notable adjustment introduced in the circular is the application of a 3 per cent VAT rate on the inaugural public performance of theatrical, musical, or dance events, with subsequent shows taxed at the standard 5 per cent. However, musical events in entertainment venues continue to be governed by the rates applicable to whether food or drink is provided. Additionally, cultural services delivered by public law bodies or non-profit organizations remain VAT exempt, thereby safeguarding their public service impetus.

Considerations For Organizers And Municipalities

The guidance also advises that municipalities, local authorities, and charitable foundations carefully evaluate their VAT registration and payment obligations when organizing ticketed events. This precaution is necessary to avoid inadvertently distorting competition with private sector organizers, which could lead to unforeseen fiscal consequences.

Conclusion

This circular represents a significant step toward ensuring consistency and fairness in VAT application within the event and cultural industries. By clearly delineating the conditions under which varying VAT rates apply, the Tax Department has provided both clarity and predictability—a welcome development for businesses, event organizers, and consumers alike.

Mortgage And Business Loan Rate Dynamics Among Cyprus Banks

Stable Mortgage Loan Rates Post-Mergers

Recent consolidations in the Cyprus banking sector have led to a striking uniformity in mortgage loan interest rates. For example, data from November 2025 reveal that Bank of Cyprus, Eurobank Ltd, and Ancoria Bank are all offering an average rate of 2.98%. Alpha Bank even offers a marginally lower rate of 2.81% for home purchases, whereas smaller market players continue to provide loans at higher costs.

Differentiated Business Loan Offerings

In contrast, business loan interest rates demonstrate greater variability. For loans up to €1 million, Alpha Bank offers the most competitive rate at 3.31%, followed by the National Bank of Greece (Cyprus) at 3.78% (NBG Cyprus). Eurobank Ltd, Kyprian Bank of Development, and Bank of Cyprus post higher averages at 4.00%, 4.46%, and 4.47% respectively, while Societe Generale Bank Cyprus and Banque SBA register even steeper rates at 6.05% and 6.54%.

For loans exceeding €1 million, the trend remains similar: Alpha Bank leads with 3.64%, trailed by National Bank of Greece (Cyprus) at 3.99% and Bank of Cyprus at 4.18%. Eurobank Ltd and Kyprian Bank of Development follow with rates of 4.54% and 4.30%, whereas Societe Generale Bank Cyprus stands out with an average rate of 6.23%.

Competitive Deposit Rates Reflect High Liquidity

Deposits in Cyprus are offered at some of the lowest interest rates in the Eurozone, a situation that reflects the exceptionally high liquidity across the local banking systems. With a Liquidity Coverage Ratio (LCR) recorded at 319% in November 2025, well above the Eurozone median of 191%, major institutions such as Bank of Cyprus, Eurobank Ltd, and Alpha Bank feature household deposit averages of 0.67%, 1.11%, and 1.36% respectively.

Meanwhile, smaller banks including Ancoria Bank, National Bank of Greece (Cyprus), and Kyprian Bank of Development report higher deposit rates of 1.47%, 1.49%, and 1.25% respectively. For business term deposits (up to one year), Ancoria Bank offers the highest average rate at 1.51%, closely followed by Alpha Bank at 1.43%. Other institutions maintain averages between 1.12% and 1.42%, underscoring a competitive yet stratified market landscape.

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