President Nikos Christodoulides on Thursday unveiled a new package of eight support measures worth over €200 million – in addition to those already in force – aimed at further easing pressure on households and businesses during the ongoing regional war launched by the US and Israel against Iran on February 28, 2026.
In a televised address, the President noted that Cyprus is located in a region “marked by significant geopolitical turbulence,” referring to the latest crisis affecting the Middle East and Gulf region. While strengthening Cyprus’ deterrence capabilities by reaching out to Greece, France, Italy, Spain and the Netherlands, the government also seeks to manage the impact of regional developments on the country's economy, he said.
Christodoulides stressed that the country’s “strong and resilient economy” – the result of “responsible economic policy” – has enabled the government to intervene effectively whenever necessary, as was the case recently with support for livestock farmers.
High growth rates, a substantial fiscal surplus, low public debt and low inflation have, according to the President, positioned the Cypriot economy to better absorb external shocks.
Christodoulides highlighted existing measures to support society, including subsidising electricity costs for vulnerable households and businesses, reduced VAT rates on electricity, and the application of reduced or zero VAT on basic goods and services.
While hoping for a de-escalation of the current conflict in the region, government planning “also considers the possibility that the crisis may last,” he said.
New measures
The President outlined eight new measures to further relieve households and support the real economy:
1. Further reduction of VAT on electricity to 5% for all household consumers from May 1, 2026, to March 31, 2027.
2. Reduction of excise duty on motor fuels by 8.33 cents per litre from April to June 2026.
3. Zero VAT rate on meat, poultry and fish from April 1 to September 30, 2026. These items will be added to the existing zero‑VAT list, which currently includes fruit and vegetables.
4. Decision not to impose Green Tax on fuels, which would have otherwise added an extra 9 cents per litre to fuel costs.
5. Subsidy covering 30% of wages for employees in the hotel industry, for hotel units and tourist accommodation operating continuously from April 1-30, 2026.
6. Support scheme for airlines to ensure uninterrupted connectivity between Cyprus and key tourism markets.
7. Subsidy scheme for farmers covering 15% of the cost of fertilisers for April and May.
8. Subsidy scheme for farmers covering 15% of the cost of agricultural supplies, also for April and May.
“The total cost of the measures we are announcing today, together with the existing measures that remain in force, exceeds €200 million. These are fully costed measures and fall within fiscal surpluses,” said Christodoulides.
“We stand by every household and every business, with actions and results,” he added.
The President said the government would be keeping a close eye on the market, promising zero tolerance for any profiteering.
“Strict instructions have already been issued to intensify inspections to ensure the effective protection of consumers,” he said.
The government will continue to safeguard stability, strengthen social resilience and protect the future of the country and its citizens, he concluded.