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Transforming Cyprus’ Airports: Government And Hermes Sign Landmark Agreement

by THEFUTURE.TEAM
December 24, 2024

The Cyprus government and Hermes Airports have formalised a landmark agreement to initiate the second phase of development for Larnaca and Paphos international airports. Signed at the Presidential Palace, the agreement also resolves longstanding disputes related to the airports’ concession.

Transport Minister Alexis Vafeades described the deal as a critical step in enhancing public interest. The ambitious plan involves simultaneous construction projects at both airports, commencing in late Q1 2025. These works depend on finalising loan agreements with banks and securing necessary planning approvals.

Minister Vafeades and Hermes CEO Eleni Kalogirou hailed the agreement as transformative for Cyprus’ tourism, local communities, and economy. Currently, both airports collaborate with 55 airlines, connecting Cyprus to 38 countries through 156 routes.

Key Updates And Developments

The upgrades will significantly expand both airports’ capacities:

  • Larnaca Airport: Expansion of the terminal by approximately 20,000 square metres, new passenger boarding gates with a connected wing, and increased aircraft parking spaces. Completion is expected within 30 months.
  • Paphos Airport: A 30% expansion of the terminal area and extension of the southern parallel taxiway to enhance safety and capacity. Completion is targeted within 27 months.

Upon completion, the airports will collectively serve over 17.4 million passengers annually, a 43% increase from the expected 12.2 million passengers in 2024.

Financial And Legal Agreements

Negotiations resulted in extending the concession agreement by 18 months and settling disputes:

  • €30 million in compensation paid by the Republic of Cyprus.
  • A €20 million loan from the Republic to Hermes Airports in exchange for withdrawing claims related to the illegal Tymbou airport in the Turkish-occupied north.
  • The upgrades impose no additional financial burden on public funds, relying instead on private financing and the concession extension.

Economic Impact

The development builds on the airports’ historical success:

  • Larnaca and Paphos airports were constructed with a €640 million investment.
  • Over 18 years, the Republic of Cyprus has collected €607 million in concession fees from Hermes Airports.
  • The agreement underscores Cyprus’ readiness for further investment and connectivity growth.

The upgrades aim to improve passenger comfort and experience at every stage, adopting modern management practices to handle increasing traffic efficiently.

Airports will serve over 17.4 million passengers annually, bolster Cyprus’ international standing, and foster economic growth without burdening public finances.

Cyprus Tax Authorities Target Undeclared Digital Earnings

by THEFUTURE.TEAM
October 24, 2025

Cyprus is intensifying its scrutiny on undeclared income from digital channels, as a new audit reveals widespread non-compliance among roughly 300 individuals and entities—including several foreign residents. The investigation, spearheaded by advanced social media monitoring, highlights income omissions from platforms like OnlyFans, which surged in prominence during the pandemic as creators monetized their content through paid subscriptions.

Advanced Monitoring Uncovers Significant Gaps

The Cyprus Tax Department’s sophisticated analytical tools uncovered numerous cases where both local and foreign earners failed to report revenue. Instances of income reaching up to €500,000 have been detected, underscoring a critical gap in fiscal reporting as digital transactions continue to grow.

Diverse Professional Sectors Under Scrutiny

The audit did not solely target digital creators; it also extended to diverse sectors including beauticians, taxi drivers, hairdressers, travel agents, and small business owners. Notably, over 50 taxi operators were found to have undeclared income surpassing €100,000—often processed via electronic payments—highlighting a broader trend of non-compliance across various service-driven industries.

EU Directives and Enhanced Transparency Measures

The enforcement framework has been bolstered by EU Directive 2011/16/EU (DAC7), which mandates that digital platforms, since July 2021, submit comprehensive user data—such as identities, tax residences, and annual incomes—directly to national tax authorities. This system, supplemented by the One Stop Shop (OSS) VAT mechanism, is instrumental in closing regulatory loopholes and ensuring cross-border financial transparency.

Expanding Focus to a Broad Range of Digital Platforms

Beyond OnlyFans, authorities are extending their audits to include income generated from YouTube, Twitch, Instagram, and other online marketplaces. By correlating bank records with online activity and spending patterns, regulators are keenly focused on individuals whose lifestyles do not match their reported incomes, ensuring equitable tax compliance across traditional and digital domains.

Implications for the Evolving Online Economy

While OnlyFans is primarily recognized for adult content, its platform also serves a wide range of professionals including musicians, fitness trainers, and artists. This comprehensive local investigation into digital earnings underscores the principle that all income—whether digital or traditional—must be declared under Cypriot law. With formal notices set to be dispatched, and the threat of backdated taxation, fines, and even criminal proceedings looming over persistent offenders, the tax department aims to safeguard fiscal integrity in an increasingly digital economic landscape.

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