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DISY Tables Proposal To Reduce VAT on Electricity

electricity prices cyprusOpposition party DISY has tabled a proposal in the House of Representatives to reduce VAT from 17 percent to 8 percent for residential consumers and five percent for agricultural consumers, after a meeting of the House Commerce Committee yesterday.

Businesses, industry and agricultural organisations pass on their VAT costs onto consumers, but consumers have no way to recoup the VAT they spend on electricity, according to a joint statement by DISY MPs Averoff Neophytou and Lefteris Christoforou.

The EAC made 866 million euros in revenue in 2011, according to a statement from DISY. Out of the total, households paid 318 million euros, businesses paid 366 million euros and industry paid 141 million euros, according to DISY's research.

The new bill will be tabled next Thursday, March 15th.

Consumer groups have protested strongly against the Electricity Authority of Cyprus' most recent bills which are based on record-breaking charges per kilowatt hour, and additional taxes and surcharges amounting to 30 percent. The economic crisis has affected the ability of many households to pay their bills, with some facing the prospect of choosing between paying their electricity bill or paying for food for the month.

The government, via spokesman Stefanos Stefanou, has already said that it disagrees with reducing VAT on electricity charges because it would lose 60 million in revenues. However, House Commerce Committee chief Lefteris Christoforou said that the losses would not be 60 million but closer to 24 million, and that the government led by ruling party AKEL should remember its promise of a 'fair society' made four years ago when it came into power.

Opposition parties DISY, DIKO, EDEK and EVROKO now control the House of Representatives with a majority after parliamentary elections last year.

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