South Cyprus loses millions in tax as motorists prefer to buy fuel in north Cyprus

The government of south Cyprus has said it lost about €12m in tax revenue in the first seven months of the year, due to Greek Cypriot motorists going to north Cyprus to fill their tanks.

According to the report by the consumer association released on Monday, during the same period, petrol stations lost close to €1m in commission.

Taking into account total sales in 2016 and 2017, the association concluded that in the first seven months of the year, people bought around 8.8m litres of 95 petrol and 8.7m litres of diesel from the north, or 3.71 per cent and 4.34 per cent respectively of the sales in the south.

It also represents 11 per cent of sales in the north.

According to the association, petrol stations lost €962,916, based on their commission which is around 5.5 cents per litre.

An estimated €12.6m was spent in the north to buy fuel, the association said – around €6.2m in consumer tax and €5.8m in VAT.

But fuel purchases from the north dropped by 50 per cent in August, compared with the previous month, as many businesses closed and people in the south went on holiday abroad.

Meanwhile in south Cyprus, the association said there had been a 3.29 per cent drop in the sales of petrol compared with 2017.

Diesel sales chalked a 4.68 per cent rise compared with the first seven months of 2017, which however, had seen a 9 per cent rise on 2016.

On the price front, the price of 95 petrol stabilised at around €1.321 per litre throughout August, while the price of diesel was around €1.327.

The cheapest district to buy petrol in August was Famagusta with Paphos being the most expensive. Nicosia was marginally the cheapest for diesel and Paphos, again, the district with the highest prices.

CM