Tax reform bills are in their final stages of preparation, with the government aiming to implement them on January 1, 2026, Finance Minister Makis Keravnos told political parties on Thursday.

Keravnos briefed party representatives during a National Council meeting at the presidential palace, noting that the immediate goal is to finalise the legislative process by August and submit the bills to parliament for approval.

If passed into law, the bills will bring about sweeping changes to Cyprus’ tax system.

President Nikos Christodoulides first outlined the reform plans in February, stating that they are designed to support and strengthen the middle class, which he described as the “foundation of every prosperous and democratic society.”

Alongside the tax reforms, the government is also moving ahead with significant changes to the attorney-general’s office and Audit Office.

Government spokesman Konstantinos Letymbiotis said that Justice Minister Marios Hartsiotis had already addressed concerns that aspects of the reforms might be unconstitutional.

“The views of the attorney-general’s office have been taken into account, both in its role as legal adviser to the state and as an affected institution,” Letymbiotis said.

He emphasised that the proposed changes were backed by all European institutions. “All views have been taken into account so that the process is as short as possible and constitutionally correct,” he added.

On Wednesday, the cabinet approved a package of draft laws aimed at modernising the operations of the attorney-general’s office and Audit Office – reforms described as a key pledge of the Christodoulides administration.

Speaking after the cabinet meeting, Justice Minister Hartsiotis said the changes address long-standing concerns about how these institutions function. A central provision is the abolition of the dual role of the attorney-general, who has until now served both as the state’s legal adviser and as head of public prosecutions.

A key feature of the reforms is also granting the Audit Office financial independence, a long-standing request from the service.

Under the proposed legislation, the terms of both the auditor-general and the deputy auditor-general will be limited to eight years.

The European Commission has highlighted the need for a clearer separation of powers in Cyprus’ legal system, while the Cyprus bar association has warned that the proposed reforms could pose practical challenges during the transition.

The bills will now be submitted to the House of Representatives for debate and voting.