Surplus climbs despite rising spending across key sectors

Cyprus posted a general government surplus of €551.2 million for the period of January to May 2025, representing 1.6 per cent of GDP, according to preliminary data released by the Statistical Service of Cyprus (Cystat) on Monday.

This marks a slight increase from the €542.6m surplus recorded during the same period in 2024, which also stood at 1.6 per cent of GDP.

Total government revenue for the first five months of 2025 rose by €310.8m. an increase of 5.6 per cent, reaching €5.9 billion compared to €5.59 billion in the corresponding period of 2024.

Revenue from taxes on income and wealth climbed to €1.37 bn, representing an increase of €137.1m, a rise of 11.1 per cent compared to €1.23 bn in 2024.

Social contributions amounted to €1.96 bn, up by €159.9m, a rise of 8.8 per cent from €1.80 bn a year earlier.

Moreover, property income also grew, rising to €92.8m from €41.1m in 2024, marking an increase of €51.7m.

Revenue from the sale of goods and services rose to €401.5m, up by €29.0m, an increase of 7.8 per cent compared to €372.5m in the same period of 2024.

Taxes on production and imports increased by €31.2m to €1.91 bn, a rise of 1.7 per cent, compared to €1.88 bn in 2024.

However, within this category, net VAT revenue declined by €12.4m or 1.0 per cent to €1.26 bn, down from €1.27 bn in the previous year.

Current transfers fell sharply by €82.2m, a drop of 36.4 per cent, amounting to €143.9m compared to €226.1m in 2024.

Capital transfers also declined significantly, dropping by €15.9m, a decrease of 60.5 per cent, to €10.4m, from €26.3m a year earlier.

On the expenditure side, total spending increased by €302.1m, a rise of 6 per cent, reaching €5.35 bn, up from €5.04 bn in the corresponding period of 2024.

Compensation of employees, including imputed social contributions and pensions of civil servants, rose to €1.59 bn, reflecting an increase of €87m, a rise of 5.8 per cent, from €1.50 bn in 2024.

Social benefits grew by €129.6m or 6.2 per cent, reaching €2.20 bn compared to €2.07 bn a year earlier.

Intermediate consumption increased by €12.8m, a rise of 2.5 per cent, amounting to €528.0m compared to €515.2m in 2024.

Interest payments went up slightly by €2.4m, an increase of 1.2 per cent, totalling €206.0m compared to €203.6m the previous year.

The capital account expanded to €435.4m, an increase of €94.3m or 27.7 per cent from €341.1m in 2024.

Gross capital formation rose by €53.7m, an increase of 18.0 per cent, reaching €352.2m compared to €298.5m a year earlier.

Other capital expenditure nearly doubled, rising by €40.6m or 95.3 per cent to €83.2m, up from €42.6m in 2024.

Current transfers on the expenditure side declined by €16.9m, a drop of 4.9 per cent, to €324.9m, from €341.8m in 2024.

Furthermore, subsidies fell by €7.1m or 10.9 per cent, amounting to €58.1m compared to €65.2m in the previous year.

Finally, Cystat said that “for a number of entities of the general government and specifically for the local government subsector, estimates have been produced by the statistical service, due to non-submission of sufficient data by the competent authorities”.