Cyprus parliament approves heating fuel tax reduction

The Cyprus House of Representatives has unanimously approved legislation to reduce the excise duty on heating fuel. The measure, which lowers the tax by 6.39 cents per litre including VAT (or 5.373 cents excluding VAT), took effect on October 23, 2026, following an accelerated legislative process that brought the implementation date forward from the originally planned November 1.

This fiscal relief, which will remain in place until April 30, 2027, is expected to cost the state budget approximately €5.2 million. The initiative aims to alleviate financial pressure on households and businesses ahead of the winter season, particularly amidst ongoing geopolitical uncertainty in the Middle East and rising international fuel prices. For a standard 1,000-litre delivery, consumers will save approximately €63.90.

Finance Minister Makis Keravnos has confirmed that the government is seeking further derogation from Brussels, with the ultimate goal of completely eliminating the excise tax on heating fuel. Discussions regarding potential additional support measures continue as legislators respond to concerns over the cost of living and rising energy expenses.