Car Import Tax Laws Discriminatory - EU

The European Commission (EC) is set to take Cyprus to the European Court of Justice (ECJ) if it does not change discriminatory laws on car import and excise duties, said the EC yesterday.

Under current laws, EU nationals who set up permanent residence in Cyprus may only benefit from an exemption from new car import duties if they are not practising any profession in Cyprus.

This situation does not apply to Cypriot citizens, nationals and descendants who return to live permanently in Cyprus and "gives more favourable tax conditions to Cypriot citizens, nationals and descendents than to other EU citizens," said the EC. The current rules violate the freedom of movement for workers and the freedom of establishment under EU rules, said the EC.

If the government does not change the rules within two months, the EC can send the case to the ECJ, which could impose fines, including daily penalities.