Half of the businesses inspected in recent days by officers of the Tax Department were found to be violating new tax legislation introduced as part of Cyprus’ tax reform.
The breaches involved businesses failing to issue receipts or invoices to customers, as well as companies refusing to accept credit cards as a payment method.
The findings from the first inspections carried out under the new enforcement measures have raised concerns among tax authorities, despite the relatively small sample size.
Targeted inspections in coastal areas
Over the past ten days, authorised Tax Department officers carried out targeted, on-site and surprise inspections at 30 businesses in coastal areas.
The checks focused on restaurants, bars, water sports companies, souvenir shops, kiosks and businesses offering sea excursions in Ayia Napa, Protaras, Larnaca and Paphos.
During the inspections, officers found that around half of the businesses were not complying with the legislation.
Officials compared their findings with information provided by customers. As customers left the businesses, officers checked whether receipts and invoices had been correctly issued and whether card payments had been accepted where required.
Warnings issued before possible closures
Following the inspections, businesses that failed to comply were issued warning letters.
Once the new deadline expires, officers will revisit the companies. If violations continue, a third notice will be issued.
Businesses that fail to comply within five days of that notice could face the sealing of their premises.
Authorities praise public cooperation
Tax authorities said the high number of violations detected during the first inspections demonstrates that the businesses selected for checks were identified through effective planning.
Officials also described the response from citizens as particularly positive, noting that customers are cooperating with Tax Department officers and providing the necessary information during inspections.
Nationwide campaign continues
A nationwide tax compliance campaign is currently underway, with targeted inspections taking place to ensure businesses follow legislation regarding the issuing of legal receipts and invoices, as well as the obligation to accept card payments.
The inspections are being carried out throughout the day and night across Cyprus, with increased focus on coastal businesses due to higher seasonal economic activity.
Tax Commissioner Sotiris Markidis urged citizens to always request a legal receipt or invoice for every transaction, stressing that public cooperation plays an important role in improving tax compliance.
He added that authorities are not aiming to shut down businesses but to encourage taxpayers to arrange payment plans and settle outstanding obligations.
Focus turns to major debtors
Beyond checks on receipt issuance and card payments, the Tax Department is preparing to introduce the sealing measure for businesses with tax debts exceeding €20,000.
A plan has already been prepared, with inspections expected to begin among around 500 businesses operating in sectors including betting, yacht sales and luxury vehicles.
The companies targeted reportedly owe more than €1 million in taxes.
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