The Parliamentary Finance and Budget Committee met today, Monday, March 14, 2022, and discussed the following matters:
1. a. The Receipt and Collection of Taxes (Amendment) (No. 2) Act, 2022
(Fak. No. 23.01.063.029-2022)
b. The Receipt and Collection of Taxes (Amendment) (No. 3) Act, 2022.
(File No. 23.01.063.031-2022)
(Proposed legislation of Mr. Panikos Leonidou on behalf of the Parliamentary Group of the Democratic Party)
The Committee began discussion of the above proposals for laws, which aim to amend the basic legislation to postpone, for the tax year 2020, the deadline for filing company tax returns (TF4), and a person obliged to keep accounting books and prepare accounts audited by an independent auditor (CF1) from 31 March 2022 to 31 July 2022, due to the adverse economic conditions caused by both the continuation of the Covid-19 pandemic and the war in Ukraine.
During the discussion, the representatives of the Ministry of Finance disagreed in principle with the proposed regulations, as the continuous extension of the submission of tax returns, in their view, is not a good practice. They argued that sufficient time had been allowed for the timely submission of such returns. The representative of the Association of Certified Public Accountants of Cyprus agreed with the proposed regulations, as the conditions prevailing in both Ukraine and Russia, due to the war and the international sanctions imposed, make it difficult to communicate with both individuals and companies, preventing the collection of the information required for the timely submission of tax returns. They also pointed out that at this stage it is not a priority for these persons to submit their tax returns.
The Commission, taking a positive view of the proposed regulations and taking into account all the points raised before it, decided to take a position on the legislative proposals at its next meeting.
2. The Excise Taxes (Amendment) Act, 2022
(No. Fak. 23.01.063.007-2022)
3. The Excise Taxes (Amendment) (No. 2) Act, 2022
(File No. 23.01.063.008-2022)
The Committee continued its consideration of the above bills by discussing them article by article in the presence of representatives of relevant government departments and stakeholders.
In this context, the Commission was informed by the relevant government departments of the corrections made to the texts of the bills, which aim to align with Council Directive (EU) 2020/262 of 19 December 2019 laying down the general arrangements for excise duties and Council Directive (EU) 2020/1151 of 29 July 2020 on the structures of excise duties on alcohol and alcoholic beverages, respectively, on the basis of the comments made at the previous meeting, in order to bring them in line with the relevant European Directives.
The Commission decided to take a position on the bills at its next meeting.
4. The Emergency Contribution for the Defence of the Republic (Amendment) (No. 4) Act, 2021.
(No. Fak. 23.01.062.085-2021)
The Committee began discussion of the above bill, in the presence of representatives of the relevant government departments and stakeholders, the purpose of which is to amend the basic law so that the reduced rate of 3% applies, in addition to individuals, and to legal persons, in the case where interest is received from pension funds, local government authorities, legal persons under public law and semi-governmental organisations, as well as to corporate securities listed on a recognised stock exchange.
During the discussion, representatives of stakeholders expressed divergent views on the bill and raised issues that require further study. The Commission decided to allow time for further consultation between them with a view to reaching an agreed revised text.
The Commission will continue the discussion on the bill at its next meeting and after the revised text has been presented to it.
5. The Income Tax (Amendment) (No. 5) Act, 2021
(No. Fak. 23.01.062.088-2021)
The Committee began debate on the above bill, the purpose of which is to amend existing law to introduce clear provisions to allow the acquiring credit union to use the special tax credits or the cleared refundable amount (RAC), as defined in Section 9D of the Income Tax Act, to pay the annual guarantee fee. In addition, it is provided that the guarantee fee paid annually by the credit institution to the State will be determined by the Minister of Finance with a minimum and maximum limit.
During the discussion, the Committee requested that further information be provided regarding the issue and that the wording of the text of the Bill be improved to make clearer the possibility for the Minister of Finance to determine the relevant limits.
The Committee decided to allow time for further stakeholder consultation and will continue the discussion on the Bill at its next meeting.
6. The Income Tax (European Union Tax Dispute Resolution Mechanisms) (Amendment) Regulations, 2022
(Doc. No. 23.03.059.012-2022)
The Commission has started the discussion of the above Regulations, the purpose of which is to comply with Council Directive (EU) 2017/1852 of 10 October 2017 on Tax Dispute Resolution Mechanisms in the European Union, concerning arrangements relating to the obligation to inform the competent tax authorities of the Member States involved in the resolution of a tax dispute.
On the basis of suggestions raised by stakeholders, the Commission expects to table a revised text of the Regulations and will continue the discussion at its next meeting.
7. Releases of funds and exceptions to the prohibition on filling vacancies.
The Commission considered a number of requests for releases of funds and exceptions to the prohibition on filling vacancies.
The releases of funds relate to. the Directorate-General for Development, Ministry of Finance,
c. the Audit Office,
d. the Ministry of Education, Sports and Youth,
e. the Office of the Commissioner for Administration and Human Rights,
f. the Ministry of Energy, Trade and Industry.
The exceptions to the prohibition on filling vacancies relate to:
a. the Deputy Ministry of Social Welfare,
b. the Cyprus Electricity Authority,
c. the Deputy Ministry of Tourism,
d. the Ministry of Defence,
e. the Ministry of Justice and Public Order,
f. the Ministry of Education, Sports and Youth,
g. the University of Cyprus,
h. The Ministry of Finance, Department of Taxation.
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Secretariat of the Parliamentary Committee on Finance and Budget
Email: parliamentary-committees@parliament.cy
(SX)
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Views & opinions expressed are those of the author and/or PIO
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