Cyprus has made starting a business less expensive by reducing the cost to register a company, according to “Doing Business 2020” which also slightly upgraded the country’s ranking to 54 out of 190 countries.
The annual study, by Washington-based World Bank, also noted that Cyprus has made paying taxes easier by implementing an online system for filing and paying mandatory labour contributions.
Doing Business 2020 is the 17th in a series of annual studies investigating the regulations that enhance business activity and those that constrain it.
It provides quantitative indicators covering 12 areas of the business environment in 190 economies. The most recent round of data collection for the project was completed in May 2019.
Economies are ranked on their ease of doing business, from 1–190. A high ease of doing business ranking means the regulatory environment is more conducive to the starting and operation of a local firm.
Cyprus got a score of 73.4 in 2020 compared to 72.8 in 2019 which marks a positive change of 0.6. It gets 76.5 for procedures, 94.5 for time, 97.2 for cost and 100.0 for pain-in minimum capital.
In addition, the study noted that Cyprus also strengthened minority investor protections by increasing disclosure of related-party transactions and strengthening shareholders’ rights and role in major corporate decisions.
And that it made paying taxes easier by abolishing the immovable property tax, discontinuing the special contribution for private sector employees, private sector pensioners and self-employed individuals.
The positive developments included the introduction of an online system for filing value added tax returns and value added tax refund claims and reducing the sewerage duty tax rates. Registering property was also made easier by decreasing the Immovable Property Tax.
However, Cyprus made paying taxes more difficult by increasing the frequency and number of VAT audits, including in cases of VAT cash refund requests.
At the same time, Cyprus made access to credit information more difficult by stopping the distribution of historical credit data.
By Marios Rousou