Cyprus parliament reviews bill to cap undeclared work fines

The Cypriot Parliamentary Labour Committee is currently debating a bill aimed at restructuring the system of administrative fines for undeclared work. As of September 17, 2026, 706 employers and self-employed individuals owe a total of 73,018,900 euros in accumulated penalties. Current legislation imposes a 50-euro daily surcharge for late payments with no upper limit, causing debts to multiply rapidly since late 2017. The proposed bill seeks to cap these surcharges at twice the original fine amount.

The debate has highlighted significant fiscal implications, as implementing this cap would result in the state writing off approximately 64.3 million euros, representing an 88.16% reduction in potential revenue. If passed, only 8.6 million euros would be collected from the existing debt pool. Furthermore, political parties, led by AKEL, have expressed strong opposition to the retroactive application of this law. While there is a consensus on the need to rationalize the system, the committee members largely reject the proposal to cancel fines that have already been issued, indicating that further revisions are expected before the bill proceeds.