Cyprus recorded a general government fiscal surplus of €1.59 billion, equivalent to 4.1% of GDP, in January-August 2026, according to preliminary data from the Statistical Service.
The surplus increased by €319.8 million from €1.269 billion, or 3.5% of GDP, in the same period of 2025. Total revenue grew by 6% year-on-year, outpacing the 3.3% rise in expenditure.
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Tax Revenue And Social Contributions Drive Growth
Total government revenue reached €10.842 billion, up €615.8 million from €10.226 billion a year earlier.
Income and wealth tax receipts rose by 14.2% to €3.080 billion, an increase of €382.4 million. Social contributions climbed 7% to €3.363 billion, while taxes on production and imports increased 8.2% to €3.342 billion.
Net value-added tax (VAT) revenue recorded particularly strong growth, rising 14.7% to €2.345 billion from €2.045 billion in January-August 2025.
Several other revenue categories declined. Capital transfers fell by €101.7 million to €89.9 million, while revenue from goods and services dropped by €14 million to €665 million. Interest and dividend receipts decreased by €37.7 million to €85.2 million, and current transfers fell by €84.9 million to €217.3 million.
Government Expenditure Reaches €9.25 Billion
Total expenditure increased by €296 million to €9.253 billion, compared with €8.957 billion in the corresponding period last year.
Social benefits rose 5.2% to €3.804 billion, an increase of €188.9 million. Compensation of employees grew by €42.2 million, or 1.6%, to €2.636 billion. Intermediate consumption increased by 10.3% to €1.014 billion, while interest payments rose 2.2% to €298.5 million.
Capital expenditure moved in the opposite direction, declining 5.3% to €819.8 million. Gross fixed capital formation fell 1.8% to €603.1 million, while other capital transfers dropped 13.6% to €216.7 million.
Surpluses Recorded Across All Government Sectors
The central government surplus rose to €735.1 million from €482.1 million in January-August 2025.
Local government recorded a surplus of €3 million, reversing a deficit of €23.6 million a year earlier. Meanwhile, the surplus of social security funds increased to €851 million from €810.8 million.
The Statistical Service cautioned that some figures are based on estimates because reporting from certain authorities remains incomplete. This particularly affects several general government entities within the local government sector.
