Philenews

AKEL and ELAM Push for New Bank Tax in Cyprus

Published January 28, 2026, 08:15
AKEL and ELAM Push for New Bank Tax in Cyprus

Parties in Cyprus, AKEL and ELAM, are promoting different proposals to tax banks due to their increased profits. AKEL proposes a solidarity levy of 40% on the increase in interest income compared to 2022, with revenues going to the Permanent Fund and being used to support borrowers. ELAM, on the other hand, proposes increasing the special tax on bank deposits from 0.00375% to 0.07%. Both proposals face difficulties in securing a majority in Parliament, as DISY and DIKO are expected to cooperate to prevent them, as they have done in the past on similar issues. The parties are pushing for their proposals to be discussed in the Finance Committee before the dissolution of Parliament in April. The Ministry of Finance, the Central Bank and the Banks Association express their disagreement with the proposals, believing that they could have negative effects on the economy. However, the parties insist that taxing banks is fair and necessary for social support. The difference in the proposals of the two parties reflects their different political agendas. AKEL seeks a more targeted taxation, linking it to the need to support borrowers, while ELAM proposes a general increase in the tax on bank deposits, considering it as a means to strengthen public finances.