VAT Reduction On Electricity: What It Means For Cypriot Households

by News Editor

March 28, 2025

From April 1, a significant change is taking place for approximately 494,000 households in Cyprus—a reduction in the Value Added Tax (VAT) on electricity from 19% to just 9%. This adjustment, announced by President Nikos Christodoulides, is set to stay in effect for a year, providing much-needed financial relief to many.

Government’s Intentions And Implications

This decision was formalized following an extensive review of the economic conditions in Cyprus. The reduction is expected to decrease the average household electricity bill by €20 every two months, totaling savings of around €120 annually. While the government anticipates a revenue dip of €40 million, the move is geared towards easing financial pressures on citizens amid broader economic trends.

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Impactful Savings And Broader Context

As Cypriot households adjust their budgets with this benefit, the measure exemplifies governmental efforts to align economic policies with constituent welfare. It mirrors broader European strategies to combat rising costs and ensure sustainability.

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Cyprus Construction Price Index Rises Amid Cost Pressures

by THEFUTURE.TEAM

February 19, 2026

The latest data from the Cyprus Statistical Service (Cystat) shows that the Price Index of Construction Materials in Cyprus reached 118.89 points in January 2026, based on a 2021 average of 100. Compared with December 2025, the index increased by 0.12%, indicating gradual price adjustments across the sector.

Year-Over-Year Growth

On an annual basis, the index recorded a 1.09% increase compared with January of the previous year. The rise reflects ongoing changes in contractor costs and highlights evolving market conditions within the construction industry.

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Commodity-Specific Movements

The report provides a detailed breakdown by material category. Minerals recorded the strongest annual increase at 2.91%, followed by electromechanical products at 2.55%. Products made from wood, insulation materials, chemicals and plastics rose by 1.19%, while mineral products increased by 0.97%. In contrast, metallic products declined by 0.49%.

Volatility In Sub-Categories

More pronounced changes were observed within specific sub-categories. Mineral aggregates rose by 8.34%, while stones increased by 4.97% compared with January 2025. Electrical fixtures posted a 4.65% increase. Iron and steel products declined by 1.73%, and ceramics and cement continued to trend lower, falling by 1.47% and 1.38% respectively.

Methodological Insights

The index is calculated as a weighted average based on the expenditure share of sampled materials during the 2021 base year. Prices are collected monthly from a range of suppliers, using the 15th of each month as the reference date and excluding VAT. The Construction Costs Index applies specifically to new residential buildings.

This detailed analysis not only sheds light on current market trends but also offers stakeholders a robust framework for understanding the underlying cost dynamics in Cyprus’s construction materials market.

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