Insider Economy Slightly higher January salaries due to CPI increase

Slightly higher January salaries due to CPI increase

End of the month salaries in Cyprus will be slightly higher in January due to a 0.23% increase in the Consumer Price Index.

A circular signed by Permanent Secretary of the Finance Ministry George Panteli said the 0.23% CPI increase is in effect from January 2020 and for a period of 12 months.

Specifically, the CPI went from 313.83% last year to 314.78% this year on basic salaries with a threshold of €11,844.

In addition, the Ministry’s calculations have the figures rising to 317.35% and 320.48%, respectively, over the next two years – 2021-2022.

The circular also said that the CPI allowance will be taken into account when calculating the remuneration of officials, employees and salaries whose basic salaries have not been incorporated in any of the indexing allowances.

“The salaries of officials and employees of the public service whose basic salaries have been incorporated, by virtue of Law 56 of 2018, have a 27.99% index rate (from 28.55% in the first half of January to June 2018) plus general wage increases of 6.656%, the indexed allowance increases from 1.04% to 1.27% on new basic salaries with a set threshold of €196, as of 1/1/2020,” it also said.

The numerical average of the CPI in 2019, excluding the impact of the excise duty fluctuation, stood at 97.03 points compared to 96.59 points the year before, that is, it marked an increase of 0.46%.

According to the 2020 annual state budget, the salaries of officials and employees and the pensions of public service retirees will be adjusted by paying 50% of the increase in the underlying CPI index of the year preceding the second and third quarters of the reference year, provided that it shows a positive growth rate.

The approved 2020 budget includes a provision which adjusts the salaries of government employees by paying 50% of the CPI tax increase of the previous year.

Meanwhile, public employees are expected to receive annual increases this year, according to the 2020 budget. But they are not expected to receive any general increases.


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