Austerity Measures Approved
The House of Representatives on Wednesday approved a new set of austerity measures, aiming at further fiscal consolidation. The parliamentarians approved a two-point hike in value added tax (VAT) from 15 to 17 per cent. The increase in VAT will be implemented as of March 1st 2012 instead of January 1st as the government has suggested which is expected to earn a total of 160 million euros by this new measure.
The plenary also voted a two year freeze of salaries in the public sector and the extraordinary contribution of private sector employees based on the scales and rates which apply to civil servants, also for two years. MPs voted the targeting of the child and student benefits, which will provide an additional 80 million euros as well as the evaluation of various allowances granted to the public servants.
Furthermore, they approved particular bills for the banks, aiming at their further support and consolidation.
Source: Cyprus News Agency