Cyprus Finance Minister Denies Major Companies Are Leaving Over 15% Tax

The Republic of Cyprus has no data indicating that major companies are leaving the country because of the introduction of a 15% minimum tax rate, Finance Minister Makis Keravnos said on Thursday. According to him, reports of such an exodus come from “individual voices” driven by personal interests or “certain obsessive ideas.”

This concerns the so-called Second Pillar (Pillar II) — an OECD and EU agreement on minimum corporate taxation. Keravnos stressed that the rule applies only to very large multinational and domestic groups with turnover exceeding €750 million and does not mean a uniform 15% rate for all businesses. Cyprus’s corporate tax rate is 12%, so such groups pay only the difference up to the minimum threshold under complex calculation rules.

The minister noted that more than 2,000 foreign parent and subsidiary companies operate in Cyprus, and their registrations continue to grow. In his assessment, there are no objective reasons for businesses to relocate: the tax environment remains competitive, while the country is adapting to the new international rules and maintaining the confidence of its partners.

Keravnos also commented on the latest statistics. The consumer price index reached 3.5% — well below the forecast 4% — while average inflation for January–August was about 2%. The 13.3% increase in prices in the restaurant and hotel sector was attributed by the minister to seasonality: at the height of the tourist season, the island’s population triples.

Unemployment stood at 7.2% in August. The minister described the figure as a temporary spike linked to the expiry of contracts in public administration, education and the administrative services sector, and as “a snapshot rather than a representative picture.” “In economic policy, the argument is data, not noise,” Keravnos said, adding that the economy is not at an impasse.