Immovable property tax absurdities Association of Property Owners’ proposals accepted
The Cyprus Association of Property Owners (KSIA) has received complaints from its members and others that the values placed on properties for the benchmark 1/1/2013 valuation were unacceptably high.
A lot of people waited to see the new level of the 2015 tax before filing a complaint.
April 25 was the last date for filing an objection and many rushed to do so at the last minute. Better late than never, our suggestions to extend this period until 31/12/2015 were finally accepted.
Despite this, there are still a few issues regarding the Immovable Property Tax (IPT) that need to be resolved:
1. It is already May 2015 and we still do not know if we’ll be paying IPT based on 1/1/1980 values or those of 1/1/2013.
2. The government has accepted that the 1/1/2013 valuations were rushed due to the memorandum deadlines, something which translates to inaccurate valuations. Based on this, why are owners asked to pay high fees to the government just to be able to file an objection? Is this a way to deter objections and take some workload off the shoulders of the government?
3. Why must the IPT be calculated and set around June to July each year and be payable in October? The liability to pay tax lies with whoever was the owner on the first day of January of the same year. Isn’t this strange, especially if someone sells a property during the first months of the year? It would make more sense to set the IPT from the previous year.
4. Why does the level of IPT depend on who is the owner of a specific property? This method of taxation only complicates matters, especially if it is based on objections filed and the value of properties changes. It would be much better if the IPT was set at a fixed percentage for all properties so that owners would easily calculate what is due. The present taxation leads to strange phenomena. If, for example, a 4-member family has four properties, owned by the mother, a higher IPT would have to be paid than if each property was owned by each family member separately. This leads to members of the same family transferring ownership to another family member.
5. The IPT is one of three taxes paid by owners based on either the 1/1/1980 or 1/1/2013 valuations. The others are the sewerage fees and the property tax paid to municipalities.
Since we are talking about one and the same property shouldn’t all three be incorporated into one to make life easier both for the state and its citizens?
Also, the level of taxation should be directly connected to the services offered to the property, like the development of green areas, rather than the financial needs of the state, the municipalities and the sewerage boards.
Taking the opportunity of the objections for the 1/1/2013 valuations, there appear to be several absurdities in the taxation of properties.
KSIA has identified several changed in the real estate sector.
The state lacks a taxation strategy and seems to show no respect to its citizens. The strategy should revolve around sensible property taxation levels to make sense for someone financially to buy and own property.
Among other things, taxation should be simple and easy to calculate. It is unacceptable to be liable for 11 different
be taxations and fees, payable to six different departments/authorities. It is also unfortunate for anyone not to know the level of tax payable for the running year.
Do the officials believe we are all masochists and wish to punish ourselves?
When politicians decide on something, should they not have the interest of the people and the country as their main criterion?
We appeal to officials to reduce and simplify taxation so that citizens are in a position to easily forecast what they will be paying over the next few years.