Cyprus pushes for fiscal flexibility and heating oil tax relief at Eurogroup

Cyprus Finance Minister Makis Keravnos traveled to Luxembourg on October 7, 2026, to participate in the Eurogroup and ECOFIN meetings scheduled for October 8 and 9. Representing the Cypriot government, Keravnos is advocating for greater fiscal flexibility within the European Union's economic governance framework. A primary goal of his mission is to secure a formal derogation regarding the excise duty on heating oil, which would allow the government to reduce the tax from its current level of 2.1 cents per litre to further cushion households against winter energy costs.

This push for fiscal space is part of a broader, coordinated effort by several EU member states, including Greece, Italy, France, Spain, and the Czech Republic. These nations are seeking increased maneuvering room to address the ongoing energy crisis and high inflationary pressures while planning for the 2028–2034 EU budget. Cyprus and its allies argue that current fiscal rules must adapt to reality to protect citizens and businesses. The discussions in Luxembourg will also focus on the effectiveness of public finances, banking competitiveness, and the overall impact of geopolitical instability on the European economy, ahead of a full summit of the 27 EU leaders scheduled for October 15 and 16.