Breaking news

Cyprus Implements EU-Mandated 15% Tax Rate On Large Multinationals

Cyprus is set to introduce a 15% minimum tax rate for large multinational corporations, in compliance with the EU directive aimed at harmonising tax policies across member states. The move, endorsed by Cyprus’ Finance Minister Makis Keravnos, is expected to generate over €200 million in additional revenue. This decision, while marking a significant shift from the current 12.5% rate, aligns Cyprus with the broader OECD-led initiative to establish a global minimum tax rate. Despite concerns, Keravnos reassured that the change is unlikely to drive multinationals out of the country, as the directive applies EU-wide.

This adjustment reflects a crucial step in Cyprus’ ongoing efforts to maintain competitiveness while adhering to international tax standards. With the proposal now before the Cabinet and soon to be discussed in Parliament, the nation is poised to balance its attractive tax regime with the demands of a globalised economy.

The introduction of this tax rate signals Cyprus’ commitment to international cooperation on tax matters, aiming to prevent profit-shifting practices that have historically allowed large corporations to minimise tax liabilities. For Cyprus, a key hub for multinational firms, this move could redefine its positioning in the global business landscape, ensuring it remains a compliant yet competitive destination for international business.

While the increase may seem minor, the 15% rate represents a broader shift in global tax policy, driven by a collective effort to create a more level playing field for taxation. For Cyprus, traditionally seen as a tax-friendly jurisdiction, this could challenge its status, pushing it to leverage other competitive advantages beyond low tax rates, such as a robust legal framework, strategic location, and skilled workforce. The long-term impact on foreign direct investment will be a critical metric to watch as this policy unfolds.

EU Agrees On Major Overhaul Of Financial Market Supervision

European Union finance ministers have reached agreement on a sweeping package designed to strengthen oversight of the bloc’s financial markets, in a move aimed at reducing fragmentation and improving the flow of capital across borders.

A Push To Deepen Capital Markets

The Market Integration and Supervision Package, or MISP, would grant the European Securities and Markets Authority direct supervision over major market operators that are currently regulated by national authorities. The reforms are intended to make Europe’s capital markets more integrated, more efficient and better able to channel savings into productive investment.

According to the Irish presidency, the package is meant to help savings and investments move more freely across the European Union, improving access to finance for companies while giving households broader opportunities to earn returns on their savings.

What The Reform Would Change

Under the new framework, ESMA would take direct oversight of key trading venues, clearing houses, securities settlement bodies and crypto-asset service providers. The package would also establish a permanent, independent executive board within the regulator, strengthening its institutional capacity.

Market operators would be able to opt into a new EU-wide operating framework. In parallel, the reforms would seek to make national supervision more consistent and update rules governing trading, transaction completion, investment management and the use of blockchain technology.

Why The Agreement Matters

Supporters of deeper capital markets argue that Europe has long paid a price for regulatory inconsistency. While many rules are harmonised across the bloc, differences in enforcement and supervision have contributed to a patchwork system that can make cross-border investment slower and more costly.

A more integrated framework, proponents say, could lower costs for companies seeking funding and broaden the menu of investment options available to savers and institutional investors alike.

Outstanding Questions Remain

Despite the broad agreement, some important details remain unresolved. Trading venues operated by Deutsche Börse, the company behind the Frankfurt stock exchange, may remain outside ESMA’s direct supervision.

Euronews previously reported that Germany had secured an exemption for Deutsche Börse’s domestically focused trading venues, leaving part of the system under regional supervision. The latest announcement did not clarify whether that arrangement will stand.

A Step Forward For The Savings And Investments Union

Dutch Finance Minister Eelco Heinen welcomed the deal, calling it a major advance for the Capital Markets Union and saying Europe had made more progress in 10 months than in the previous 10 years.

The agreement is an important milestone in the Savings and Investments Union, the EU’s broader effort to channel more of Europeans’ savings into investments that can support growth, innovation and competitiveness across the bloc.

Aretilaw firm
Uol
The Future Forbes Realty Global Properties
eCredo

Become a Speaker

Become a Speaker

Become a Partner

Subscribe for our weekly newsletter