AmCham Cyprus calls for impact assessment of Pillar Two tax rules

The American Chamber of Commerce in Cyprus (AmCham Cyprus) has officially requested an independent, evidence-based assessment regarding the potential impact of the OECD/G20 Pillar Two international tax framework on the country's investment climate. This call comes as the nation prepares to implement rules requiring multinational and large domestic groups with annual revenues exceeding €750 million to pay a minimum effective tax rate of 15%.

While AmCham Cyprus maintains its support for international tax cooperation and regulatory compliance, it has expressed concerns relayed by business leaders and international investors that the new rules could negatively affect Cyprus's competitiveness. Finance Minister Makis Keravnos has countered these concerns by stating that the policy only applies to approximately 2,000 entities in Cyprus. He clarified that the tax is not a flat 15% surcharge, but rather a top-up mechanism to bridge the gap between the current 12.5% effective tax rate and the new 15% minimum threshold. The Chamber remains concerned that multinational firms may consider alternative jurisdictions if the regulatory changes are perceived as overly burdensome, emphasizing the need to preserve the nation's status as a stable international business hub.