The Cyprus Tax Department has announced a further extension of the 0% VAT rate on selected essential goods until 31 December 2027.
Under Decree K.D.P. 362/2026, dated 16 October 2026, the existing zero VAT rate will continue to apply from 1 January to 31 December 2027, maintaining VAT relief on certain essential household products.
Which goods are covered?
The zero VAT rate will continue to apply to the following categories of goods:
- Baby milk, in liquid and powdered form.
- Baby and adult nappies, including incontinence pads.
- Feminine hygiene products, including sanitary towels and tampons.
- Fresh or chilled vegetables, including potatoes, tomatoes, onions, garlic, lettuce, carrots, cucumbers, and other specified vegetables.
- Fresh fruit, including bananas, avocados, citrus fruits, grapes, and other specified fruits.
The zero VAT rate applies to products falling within the descriptions and Combined Nomenclature (CN) codes specified in the relevant Decree.
Implications for Businesses
Retailers, supermarkets and other suppliers of the affected goods can continue applying the zero VAT rate throughout 2027, provided that the products qualify under the relevant provisions.
Businesses should ensure that their products are correctly classified and that the appropriate VAT rate is reflected in their accounting and invoicing systems. This is particularly important for suppliers dealing with both zero-rated and standard-rated goods.
Note, that this extension is separate from other temporary zero VAT measures covering additional food products, which are subject to different expiry dates.
Eurofast’s Take
Eurofast can assist retailers, supermarkets and other suppliers in confirming which of their products qualify for the zero VAT rate, reviewing code classifications and ensuring that the correct VAT rates are applied in their invoicing and accounting systems throughout 2027. We can also advise on how this extension interacts with other temporary zero VAT measures and their respective expiry dates.
For further information or assistance, please contact our Nicosia office at [email protected].