Cyprus Government Introduces Measures in Response to the COVID-19 Pandemic
Corona Virus or as officially named by the World Health Organisation (the “WHO”) as COVID-19 first reported in Wuhan, China at the end of December 2019. So far according to the statistical data of the WHO more than 164,837 people have been diagnosed with the disease globally, 6,470 people have died and over 77,500 people recovered.
Many countries are bringing out strict measures to stop the virus spreading as well as tackle the effects of the virus. Italy, France and Spain are in total lockdown, US restricted all air traffic from China and Europe. The EU has also proposed to close its borders for non-essential travelling from non-EU destinations with certain exceptions.
Cyprus has so far 49 cases confirmed. President Anastasiades addressed the nation and described the situation as a state of emergency on Sunday the 15th of March 2020 following an extraordinary meeting of the Council of Ministers. The Council of Ministers introduced a series of measures.
The following private businesses in Cyprus will be closed from Monday 16th March 2020 for a period of four weeks:
The decision covers malls, department stores, cinemas, theatres, libraries, museums, archaeological sites, betting shops, casinos, sports venues and clubs, theme parks, barbershops and hairdresser salons, beauticians, cafes, bars, and all food and beverage businesses excluding those that only do delivery and take away.
Hotels will be given six days to serve their existing clients and then they must subsequently suspend their operations until April 30th 2020.
Pharmacies, private health services, bakeries, supermarkets, kiosks, and petrol stations under certain conditions will remain open.
Further measures have been announced including:
1.The only persons to be allowed into the country are the ones that present medical clearance certificates showing that they have tested negative for corona virus. All other arrivals will be subject to 14 days compulsory quarantine at the state selected facilities.
Cypriot students are encouraged to remain overseas for the Easter holidays, if they choose to stay abroad they will be subsidised by the state with €750.
The entry requirement came into force on 16th of March 2020 and will be in force until the 30th of April 2020.
2. Aid for protection of workers and vulnerable groups (one month – € 20m, potential beneficiaries 50,000 persons);
Due to the closure of schools, nurseries, and child care centers, parents who are working in private sector will be granted a “special leave”.
Special leave may last up to four weeks and does not include the public holidays.
Special leave allowance provided for a parent with a salary of up to €2,500 is: 60% of the first €1,000 and 40% second €1,000. In the case of a single parent family percentage will be 70% to %50.
The Special Leave permit will be granted to only one parent, if one parent receives the permit the other cannot at the same time unless they are infected with the virus, or hospitalized, or disabled. The permit will only be granted if the nature of the work does not allow remote and flexible working arrangements.
The parents of disabled persons who do not receive care allowance are also entitled the aforementioned permit.
3. Suspension plan for businesses;
Businesses which are currently caught by the mandatory closures and those currently operating but suffer more than 25% turnover reduction will be covered under this plan and employees affected will receive unemployment benefits as long as the business is suspended.
4. Small business support plan (€ 10m);
Businesses that employ up to 5 people, provided they do not made their employees redundant and their turnover is reduced by more than 25% are eligible for to receive subsidy of 70% of employee salaries.
5. Schedule of remuneration for the afternoon programs of the Ministry of Education (€ 3m);
Allowance to be provided to individuals working in the evening and evening programs of the Ministry of Education, Culture, Sport and Youth (Music Schools, Sports Schools, State Institutes of Education, Training Institutes, Education Institutions, Education Institutions, and Evening Technical School Programs and the “School and Social Inclusion Actions” Program) and other similar service purchase programs of the Ministry of Education. Allowance will be equivalent to full payment and will cover approximately around 5000 persons.
6. Payment of ‘sickness benefit’ on average € 800 per month to (For every 20,000 employees, 16m);
The payment will be available to the following cases:
i. Employees who have specific health problems, are on the list prepared by the Ministry of Health and who must be absent from work for the purposes of protecting their health and not deteriorating it. A certificate by their personal physician must be provided.
ii. Cases of compulsory absence from work instructed by the Authorities (Category 1 – compulsory restraint under medical supervision (quarantine), and Category 2 – self-restraint under telephone surveillance), provided that restricted employees hold a certificate issued by the Ministry of Health.
iii. Persons over the age of 63 year until the age of 65, who do not receive a statutory pension and continue to work and which fall under the aforementioned categories 1 and 2 of the Ministry of Health, provided that restricted workers hold a certificate issued by the Ministry of Health.
vi. For the purpose of assisting self-employed workers, sickness benefit will be paid from the fourth day onward.
7. Extension of the time period for filing objections of self-employed persons for social insurance for one month until 30 April 2020 (expires 31 March 2020).
8. Creating mobile workshops to serve the elderly and vulnerable so that they can be supplied with the goods they need. Help will be sought from Volunteers and Charities to achieve this goal.
9. Provision to strengthen the health sector with € 100m to fight the pandemic if needed, which will cover, inter alia:
- Employment of additional medical, nursing and support staff,
- Enhancement in equipment and logistics,
- Strengthening the Institute of Neurology & Genetics in both human resources and logistics,
- Strengthening the Ambulance Services, and
- Strengthening the Call Service 1420.
10. Cancellation of the payment of the additional levy on GESY (National Health Service of Cyprus) planned for 31/3/2020 for two months, by employers, employees and the state (€98m).
11. Provisional suspension for two months of the obligation to pay VAT for companies whose turnover was less than € 1m according to tax declarations submitted in 2019 and companies whose turnover decreased by more than 25%, without imposing any fines. It is noted that arrangements will be made so that the debts can be paid progressively until November 11, 2020. (€ 240m)
This measure aims to aid businesses that are expected to face a liquidity problem.
12. VAT to be reduced from 19% to 17% for a period of two months and from 9% to 7% for a period of three and a half months, as soon as the relevant legislation has been adopted to enhance the purchasing power of the citizens and stimulate consumption. (€ 70m)
13. The obligation to file tax returns has been extended for those who were required to do so by 31.3.2020. (new deadline is set to 31.5.2020)
14. Special arrangements will be made to support tax payers who have entered the Overdue Tax Settlement Scheme.
15. Suspension of the requirement to retain guarantees under public and private contracts for the supply of services or products that will be delayed by the crisis.
16. An Action plan to support Tourism Industry between June and September 2020, in cooperation with Airlines and Travel Agencies, as well as measures to enhance the attraction of tourists during the period October 2020 – March 2021 (€11m).
17. Banking sector: The ECB has already considered measures in support of bank lending. Under the new measures, Cypriot financial institutions will be able to obtain liquidity from the Eurosystem on substantially favorable terms. The measures decided by the ECB include, inter alia, the release of capital stocks, which for the Cyprus systemic banks are estimated by the CBC in excess of € 1.3 billion. In addition, the Central Bank of Cyprus is considering further local measures which will be announced by the Governor of the Central Bank shortly thereafter.
18. Introducing a cap in the prices of personal hygiene products (masks, antiseptics, antibacterial liquids, soaps, etc.) to counter the effects of profiteering. The cap was introduced on the 17th of March 2020 by order of the Minister of Health under article 6 (a), (b), (c) and (d) of the Purification Law, Cap 260.
19. Necessary personnel in the Public Service:
The public service and the broader public sector and education service providers for the coming month, starting on the 17th of March 2020, will be working on:
i. where possible from their home
ii. with emergency personnel and emergency services
Essential services are excluded from the above regulation.
Further clarifications and possible amendments are expected to be introduced as this crisis develops.
We remain at your disposal for any clarification you might require.
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