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Cyprus’s Strategic Tax Incentives Attract Global Talent

Cyprus has successfully leveraged tax incentives to attract both international experts and returning Cypriot professionals, generating €406.6 million in tax exemptions over three years. During the period from 2021 to 2023, a total of 25,277 employees relocated to the island, declaring salaries amounting to €1.31 billion and enjoying tax relief between 20% and 50% based on individual circumstances.

Overview Of A Bold Strategic Initiative

The tax breaks form a critical pillar of Cyprus’s broader strategy to entice high-caliber talent from across the globe. Under the auspices of the upcoming ‘Minds in Cyprus’ bill—currently under detailed review by the finance committee—this initiative aims to formalize and extend tax exemptions. The measure is designed to foster economic growth by attracting professionals through significant income deductions and fiscal relief.

National And Sectoral Breakdown

Data presented to parliament reveal a distinct demographic spread among beneficiaries. Over 5,200 exemptions benefited Cypriot professionals, cumulatively saving €84.8 million on declared salaries of €263.6 million. However, the bulk of the incentive’s rewards have gone to foreign nationals, with Russian citizens at the forefront. Russian professionals received €156.9 million in exemptions from a total of €513.8 million in earnings, closely followed by Greek experts—2,825 employees securing €32.9 million in tax benefits—and other nationalities including Ukrainians, Belarusians, Israelis, British, Lebanese, Indians, Germans, Italians, and French.

Sectoral analysis further underscores the program’s wide-ranging impact. The information and communication technologies (ICT) sector, for example, accounted for 9,060 employees earning €450.2 million and benefiting from €136.4 million in tax exemptions. Scientific and technical fields, along with financial and insurance services, similarly reaped substantial fiscal advantages, contributing to the overall dynamism of Cyprus’s economic landscape. Additional sectors, from wholesale and retail trade to public administration and healthcare, also recorded meaningful benefits.

Policy Debate And Concerns Over Equity

While the fiscal incentives have been broadly welcomed, they have not been without controversy. During recent sessions of the house finance committee, concerns were raised regarding the unequal treatment of taxpayers. Critics, including representatives from the bar association, have cautioned that the policy might inadvertently promote a brain drain by encouraging local specialists to temporarily work abroad in order to capitalize on the exemptions. Despite these critiques, legal representatives defended the measures, asserting that the policy does not discriminate but rather aims to enhance the island’s competitiveness on the international stage.

As Cyprus continues to fine-tune its framework for attracting global talent, the ongoing discussions will play a pivotal role in determining how the benefits of these incentives are balanced against emerging challenges. The outcome will likely set a precedent for similar economies striving to merge fiscal policy with talent acquisition in a competitive global market.

AI Adoption Makes Employee Performance Harder To Assess, Survey Finds

Companies have rapidly adopted AI tools to improve productivity, but the technology is creating new challenges for managers, who say it is becoming harder to evaluate work, supervise teams and maintain control.

More than half of senior leaders surveyed said assessing employee performance had become more difficult since their organisations adopted AI, according to a Nielsen survey of 1,700 directors and senior managers across seven countries, commissioned by work-management software company Monday.com.

AI Makes Performance Harder To Measure

AI allows employees to produce polished work more quickly, making it harder for managers to distinguish between human effort and machine-generated output. Nearly half of respondents said they now spend more time reviewing and guiding their teams’ work.

Despite these challenges, enthusiasm remains high: 94% said they were excited about using AI to improve work.

Michal Miller Levi, head of market research and customer insights at Monday.com, said organisations were struggling to adapt their processes at the same pace as the technology.

“AI works very well for [managers] individually, but they also have a different role as managers. They need to drive the organization as well […] Their struggle is [due to] the fact that AI is just moving faster than the organizational processes,” she told TechCrunch.

Performance Reviews And AI Bias

AI is also changing how employee performance is evaluated. According to the survey, 78% of respondents had changed their performance criteria since adopting AI, placing greater emphasis on prompt-writing, deciding which tasks to delegate to AI and experimenting with new working methods.

At the same time, AI is increasingly involved in the evaluation process itself. Some 46% of managers said they use AI to inform decisions, while 39% use it to draft performance reviews.

This raises concerns about fairness and algorithmic bias. Research from the Luxembourg Institute of Socio-Economic Research found that, without clear objective standards, large language models tend to rate performance in ways that mirror human evaluators. A separate paper published in early 2025 found that AI models could exhibit biases against Black male candidates, with differences across social groups.

Levi said companies had yet to establish the right frameworks for managing these risks.

AI Adds To Managers’ Workloads

Managers are increasingly responsible for assigning tasks to AI agents, reviewing their output and intervening when systems make mistakes. This creates an additional layer of oversight, or “invisible labour”, on top of their existing responsibilities.

The software environment is also becoming more complex. Some 57% of managers said their organisations now use more tools than before AI adoption, while 51% reported greater interdependence between those tools. Only 29% described their AI infrastructure as fully optimised and centralised.

Rather than consolidating software, many companies are dealing with more applications, integrations and unauthorised AI tools used outside approved systems.

Governance Becomes The Next AI Challenge

The survey suggests that oversight will become even more important as businesses deploy increasingly autonomous AI agents. Some 58% of managers expect to oversee more AI agents than human employees within the next year, while 46% are concerned about losing control over their agents’ actions. Another 35% worry about being held responsible for decisions made by AI.

Levi said managers wanted human involvement in critical tasks and decisions, with AI supporting rather than replacing human judgement.

The findings point to a broader challenge for businesses: boosting productivity is only part of successful AI adoption. Companies also need clear processes, reliable infrastructure and accountability frameworks to ensure that faster output does not come at the expense of effective management.

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