ICPAC- Carefully studying the tax reform and collecting opinions before submitting an official response

The Institute of Certified Public Accountants of Cyprus (ICPAC) will take a position on the proposals of the University of Cyprus’ Economics Research Centre (CypERC) on the tax reform, as presented last week, in an official document that it will prepare and submit to the Ministry of Finance, with notification to all its members.

In more detail, with the deadline for completing the public consultation CypERC’s recommendations set for 19 March, ICPAC and more specifically the Institute’s tax committees are, as InBusinessssNews has been informed, in the process of studying and evaluating the proposals.

At the same time, ICPAC has asked its members to submit their opinions and comments electronically by 11 March, in order for them to be taken into account by its tax committees, while at the same time, the Institute is meeting with and listening to the positions of other economic and business entities.

In this context, it is worth noting that the Institute, on Wednesday, 5 March met with the Cyprus Chamber of Commerce & Industry (CCCI) and Cyprus Employers & Industrialists Federation (OEB).

Upon completion of the contacts and receipt of opinions and comments on CypERC's proposals from its members, as well as of course the positions of the other economic actors, ICPAC will proceed with the formulation of an official document through which it will forward as its position to the Ministry of Finance.

High on the 2025 agenda

It is worth noting that tax reform is high on the agenda of ICPAC's priorities for 2025, as is evident from a recent circular Kyriakos Iordanou, ICPAC’s General Manager sent to all its members.

ICPAC characterises 2025 as an enigmatic year, identifying the period we are going through as a time of change and uncertainty in the international political-economic scene and expecting that broader economic and commercial activity will largely be determined by the change of government in the US along with political developments in Europe, the situation in the Middle East and the commercial pole of the Asian zone.

According to an information circular from the Institute’s General Manager, in view of the new year, the strategic objectives of ICPAC for 2025, to which more emphasis and focus will be given, are the following:

• Its relocation to new, more comfortable and modern office spaces, from where its services will be provided, with a simultaneous conversion of the existing emblematic building to serve other ICPAC needs.
• The introduction of advanced computer and digital technologies, both for office work and, most importantly, for the service of members and licensed firms, reducing unnecessary bureaucracy and any delays. Various such works are already underway, which are expected to be gradually introduced soon.
• Strengthening the communication and visibility of ICPAC, with the aim of highlighting both its role and the value and importance of our profession, as well as the contribution of all colleagues to the economy and functioning of the country.
• The promotion of the advantages of the accounting profession in a digitalised financial environment, with the aim of offering prospects for quality employment to young people. ICPAC's participation with several presentations and various actions in schools, academic institutions and elsewhere continues, as does its contribution to the work on financial literacy.
• The highlighting of issues concerning small and medium-sized enterprises and small and medium-sized offices, which is consistent with the relevant European Union Directives. This includes the ICPAC initiative to implement a financial reporting standard adapted for small businesses, a project that is currently underway.
• Simplifying various procedures, especially public ones, with the aim of reducing the administrative burden and enhancing efficiency and functionality in the execution of the many obligations of professional accountants.
• Further improving and strengthening the way in which ICPAC exercises its regulatory and supervisory duties. Of course, depending on the developments of various issues concerning ICPAC, it is ready to seriously examine its regulatory and supervisory responsibilities, both in terms of their size and in terms of the way in which they are exercised.

Tax reform and other issues high on the agenda

As noted in the same circular, the following occupy a prominent place on the ICPAC agenda:

• The Tax Reform project.
• The establishment of the Single Supervisory Authority.
• The establishment of the National Sanctions Implementation Unit.
• The amendment of the Companies Law.
• The amendment of the Auditors Law with regard to the adoption of the Corporate Sustainability Reporting Directive (CSRD) and the adaptation of the reports of accountants, auditors, management committees/boards of directors of companies, in collaboration with the Cyprus Public Audit Oversight Board.
• The attraction of foreign direct investments and businesses in Cyprus and the relevant legislative regulation for their control.
• The increase and strengthening of the competitiveness of the economy, along with the strategic planning "Vision 2035".
• The issues of combating corruption and enhancing transparency.
• Public sector reforms, as they have been discussed over time.
• The further development and consolidation of ICPAC's cooperation with other economic and social actors, both within and outside Cyprus, in particular with Accountancy Europe and IFAC.
• The enrichment and increase of educational activities for its members, at the lowest possible cost.
• The continuation of safeguarding the public interest through the framework of the Institute's ethics and the principles of transparency and objectivity.

Internal and external risks

The repercussions of the wars in Ukraine, Israel and Syria, from increased energy prices and costs, trade and economic developments, as well as increased obligations towards tax, regulatory and other compliance, increase the burdens and operating costs of businesses and accounting firms themselves, the ICPAC General Manager explains, going on to state that for 2025, the internal risks include any deviation from the broader strategic planning either due to political reasons in view of the 2026 parliamentary elections, or due to satisfying various demands and populist approaches, which are expected to be brought about by fiscal pressures.

Exogenous risks include uncertainty in the global political and commercial market, geopolitical and economic challenges and revisions, the potential increased costs in international trade and the disruption of the supply chain, due to the above factors. At the same time, the impacts of climate change are another risk.

"The big challenge is how we will leverage our advantages as a country, as well as how we will strengthen the internal operational infrastructure of the state, in order to support the further development, in sustainable and realistic terms, of the country's economic activity and entrepreneurship, so that it is able to overcome the challenges that will arise. What I would emphasise in turn is that the attractiveness of the country is directly linked to its competitiveness.

"As far as ICPAC itself is concerned, 2025 finds us on the front lines of continuously strengthening and strengthening our own infrastructure and means as a priority, so that we are able to serve the Institute's purposes and our members to the best possible extent."

"The fields that require the participation, responsibility and action of ICPAC are increasing and becoming even more complex, a fact that leaves no room for complacency or stagnation," says Kyriakos Iordanou.

(Source: InBusinessNews)