Green taxes expected to come into effect in May are now being postponed, finance ministry permanent secretary Andreas Zachariades said on Thursday.

Zachariades said the carbon taxes would most likely be imposed during the summer and that the planned overnight stay fee for tourists would probably be left till the end of 2026, as it was not related to the recovery and resilience plan.

“We still have time (for the green taxes), because the EU procedure has a time delay as well, but it is something that should happen within the next two or three months. It won’t be in May, but it might be in the summer” before the House recess, Zachariades explained.

For this year, the carbon tax is about 5.95 cents per litre and will go up another 10 cents in 2026.
Zachariades said that “regardless of this tax, with the ETS2 (the European emissions cap-and-trade system), in 2027 the carbon tax will be imposed anyway.”

The cost in 2027 is calculated at around 18 to 20 cents per litre, which would include the 5.95 cents to be imposed this year.

Zachariades said there was a projected revenue of about €70 million for the next 18 months and that there would be counterbalancing measures, such as subsidies for vulnerable groups and car replacement schemes.

Regarding the overnight stay fee, which will be €2.50 per night and affects the hotel industry, Zachariades said the measure was not a commitment towards the European Commission.

So, he said, it will be handled differently, as it is not connected to the recovery and resilience plan.
Again, counterbalancing measures will be in place for hoteliers

Regarding the other green taxes, Zachariades said the green water fee had already passed and stood at €0.01 per cubic metre.

The waste fee was still pending, he added.

In a first reaction, Akel said the finance minister is unable to comprehend how the majority of the people live.

“If the finance minister believes that Akel’s position for not imposing the green taxes is ‘exaggerated and a load of rubbish’, then he is simply confirming that he does not want to and can neither understand how a large portion of the society is living,” Akel said.

Akel added that “the government, by insisting on burdening households and businesses with an extra cost on basic goods, such as fuel, water and waste, in conditions of generalised high prices and the international financial uncertainty, constitutes hard proof that it does not comprehend the real economic situation in the society.”

The party called on the government to withdraw the taxes, instead of “underestimating the intelligence” of the people.