Government proposes increase in VAT rate, introduction of solidarity tax.
The government proposed an increase of the VAT rate by 1pps to 23%, as well as introduction of a 3% solidarity tax on salaries, pensions and other income above HRK 3,000.
The Cyprus government plans to hike VAT by two percentage points and increase a handful of other taxes as part of a watered down austerity package which aims to raise 600 mln euros, that may find resistance in parliament as it does little to reduce public spending and cut down on a bloated civil service.