Implementation of the 2025 state budget reached 59% for revenue and 52% for expenditure by end of September, according to the Treasury of the Republic of Cyprus.
Specifically, by the end of September 2025, revenue amounted to pound 6.91 billion, corresponding to 59% of the state budget (2024: pound 7.72 billion, 68%), while actual expenditures reached pound 6.75 billion, representing a implementation rate of 52%(2024: pound 7.94 billion, 58%).
According to the Treasury, the implementation of the state budget in terms of revenues shows a decrease compared to the same period last year, mainly due to a reduction in loan drawdowns by pound 1.06 billion, which is offset by increases in direct and indirect taxes by pound 0.15 billion and pound 0.14 billion, respectively.
Moreover, the implementation of the state budget regarding expenditure is also reduced, mainly due to lower repayments of loans and interest by pound 1.33 billion.
Revenue
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According to the Treasury, during the period January-September 2025, indirect taxes increased by pound 0.14 billion (5%) compared with 2024, mainly due to the increase in VAT revenues by pound 0.07 billion (2025: pound 2.29 billion, 2024: pound 2.22 billion), revenues from other indirect taxes by pound 0.04 billion (2025: pound 0.41 billion, 2024: pound 0.37 billion), and revenues from excise duties by pound 0.03 billion (2025: pound 0.39 billion, 2024: pound 0.36 billion).
Direct taxes increased by pound 0.15 billion (5%) compared with 2024, mainly due to the increase in income tax from legal and natural persons by pound 0.12 billion (2025: pound 2.58 billion, 2024: pound 2.46 billion).
It is also noted that by the end of September 2025, loan drawdowns amounted to pound 0.04 billion (2024: pound 1.10 billion).
Expenditure
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According to the Treasury, the implementation of payroll, pensions, and gratuities by the end of September shows a slight decrease of pound 0.01 billion, from pound 2.46 billion in 2024 to pound 2.45 billion in 2025.
Loan and interest repayments by the end of September amounted to pound 0.62 billion (2024: pound 1.96 billion), of which pound 0.48 billion (2024: pound 0.55 billion) concerned loan interest and charges, pound 0.07 billion (2024: pound 0.34 billion) the repayment of domestic loans, and pound 0.07 billion (2024: pound 1.06 billion) the repayment of external loans.
Expenditures on social benefits by the end of September reached pound 1.37 billion (2024: pound 1.33 billion). The increase of pound 0.04 billion (3%) is attributed mainly to higher healthcare benefits by pound 0.06 billion (2025: pound 0.61 billion, 2024: pound 0.55 billion), combined with a reduction in social welfare benefits by pound 0.03 billion (2025: pound 0.51 billion, 2024: pound 0.54 billion).
Additionally, transfers and subsidies by the end of September reached pound 1.31 billion (2024: pound 1.16 billion), marking an increase of pound 0.15 billion (13%) compared to the same period last year.
Operating and other expenses by the end of September amounted to pound 0.61 billion (2024: pound 0.67 billion), showing a decrease of pound 0.06 billion (9%).
According to the Treasury, over the last decade, the average implementation rate of total state budget expenditures by September has been 60%. The lower implementation rates in 2018 and 2025 are mainly due to the seasonality of public debt repayments. The implementation rate for 2025 stands at 52%.
As for development expenditures, the Treasury reports that capital expenditure implementation by the end of September reached pound 250.9 million, co-financed projects and other financing expenditures reached pound 132.5 million, grants, contributions, and subsidies by the end of September reached pound 160.1 million and the implementation of social benefits reached pound 40.5 million.
Over the past decade, the average implementation rate of the state development expenditure budget by the end of September stood at 36%. The implementation rate for 2025 is 39%, according to the Treasury.