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Cyprus Investment Sector Calls For Deputy Ministry To Drive Sustainable Growth And Competitiveness

by THEFUTURE.TEAM

November 21, 2025

The Association of Large Investment Projects has renewed its call for establishing a dedicated Deputy Ministry for Development and Competitiveness. In a statement to President Nikos Christodoulides, association president Andreas Demetriades emphasized the need for a coherent national strategy centered on healthy, sustainable development and well-defined incentives.

Driving Job Creation And Economic Resilience

Addressing stakeholders at the association’s general assembly, Demetriades asserted that large-scale projects not only create jobs but also strengthen the social fabric and secure Cyprus’ future. The deputy ministry would be tasked with bolstering competitiveness, attracting high-quality investments, and coordinating much-needed reforms—from streamlining licensing processes and digitalizing services to establishing a one-stop shop for investors.

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Accelerating Reforms And Simplifying Approvals

The proposed body would oversee targeted licensing for strategic projects, thereby accelerating the development process in measurable ways. This aligns with a broader vision to position Cyprus as a regional business hub, attracting investments in high-end healthcare, higher education, technology, IT, tourism, shipping, green energy, and modern infrastructure.

Showcasing A Portfolio Of Impactful Developments

Demetriades highlighted that the 16 association members manage the island’s largest developments, attracting consistent foreign interest with an €8 billion portfolio spanning marinas, casinos, golf courses, universities, medical centers, research parks, and expansive tourist projects. Such initiatives have not only upgraded Cyprus’ investment and tourism landscape but have also supported thousands of jobs and improved living standards.

Policy Initiatives And Institutional Enhancements

In discussing long-term priorities, Demetriades stressed the importance of continual improvements in the business environment. He cited the recent cost of living allowance (CoLA) agreement as a demonstration of institutional maturity among the state, employers, and unions—a success that reinforces stability and predictability. As Cyprus prepares to assume the EU Council Presidency, these policy improvements are critical for handling weighty European dossiers, including the multiannual financial framework, competitiveness, defense, and security.

Addressing Housing And Infrastructure Challenges

Despite the progress, significant challenges remain. Demetriades underscored the pressing need to address housing shortages and expand educational infrastructure. He recommended targeted incentives, such as increasing building coefficients in selected areas and employing VAT mechanisms for investments in rental properties, to meet the rising demand for affordable housing.

Energy Strategy, Schengen Accession And Local Governance

High energy costs demand a robust, long-term national strategy, which includes improving natural gas supply, accelerating storage system deployment, and constructing critical infrastructure to enhance security and sufficiency. Additionally, accession to the Schengen Area would expand Cyprus’ economic reach and enhance its credibility among international investors.

Collaboration To Overcome Institutional Hurdles

Speakers representing key institutions, including Andreas Tsouloftas conveying President Stavros Stavrou’s message and Constantinos Yiorkadjis from the Nicosia EOA, stressed the importance of multi-level cooperation. They outlined measures such as digitizing permit processes and creating dedicated development services to address longstanding obstacles like bureaucracy, slow licensing, and manpower shortages. Local authorities, especially in sectors like water supply and sewage management, play an essential role in facilitating development and mitigating infrastructure constraints.

A Pivotal Moment For Cyprus

Despite global uncertainty, the resilient Cypriot economy continues to attract quality foreign investment. As institutional reforms progress and strategic incentives are implemented, large-scale developments are poised to sustain and further elevate Cyprus’ competitive edge. Through an integrated approach and strong public-private collaboration, Cyprus is well-positioned to emerge as a pillar of stability, modern governance, and sustainable growth in the region.

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Cyprus Introduces 8% Crypto Tax As European Rules Diverge

Fragmented Crypto Tax Rules Across Europe

Although the European Union has introduced a common regulatory framework for digital assets through the Markets in Crypto-Assets Regulation (MiCA), taxation remains under the jurisdiction of individual member states. As a result, crypto investors face a wide range of tax regimes across Europe.

Cyprus Introduces Dedicated Crypto Tax Framework

Beginning January 1, 2026, Cyprus will implement a dedicated taxation regime for digital assets. The new framework imposes an 8% flat tax on net gains from cryptocurrencies such as Bitcoin and Ethereum, making it one of the lowest rates within the European Union. Taxable events will include the sale, exchange, or use of cryptocurrencies for payments and donations. Losses will only be offset against gains generated from crypto transactions within the same tax year, with no provision allowing losses to be carried forward.

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Diverging Approaches Across Europe

Several European countries have adopted markedly different policies. Greece is preparing legislation that would introduce a 15% capital gains tax on cryptocurrency profits, with the first €500 of gains exempt from taxation. Germany classifies cryptocurrencies as private assets. Gains are generally exempt from tax if the assets have been held for more than one year, distinguishing the country from many other European jurisdictions.

Other Key Jurisdictions

Portugal continues to offer favorable conditions for long-term investors, with private individuals generally exempt from taxation if digital assets are held for more than 12 months. Switzerland treats cryptocurrencies as part of personal wealth, subject to annual cantonal wealth taxes, while capital gains realized by individual investors are typically exempt. France applies a flat tax of 31.4% on cryptocurrency gains, combining income tax and social contributions. Italy recently increased the tax rate on crypto gains for individuals to 33%, up from 26%, while Spain applies progressive rates ranging from 19% to 30%, depending on the amount of profit realized.

The Netherlands And The Baltic States

The Netherlands uses a different model, taxing presumed returns on assets regardless of whether they have actually been sold. Tax treatment in the Baltic region varies. Lithuania generally imposes a 15% rate, rising to 20% for very high non-salary income. Latvia applies a 25.5% capital gains tax, while Estonia taxes cryptocurrency gains at the standard personal income tax rate of 22%, without exemptions for long-term holdings.

A Diverse Tax Landscape

Approaches to cryptocurrency taxation continue to differ significantly across Europe. Cyprus’ upcoming framework places the country among jurisdictions offering relatively low rates and dedicated rules for digital assets, while investors operating across borders continue to navigate a patchwork of national tax regimes.