Nicosia: The implementation of the State Budget for the first 11 months of 2025 has recorded a decrease in revenue compared to the same period last year, alongside a slight increase in expenditure, as announced by the Treasury of the Republic.
According to Cyprus News Agency, the Treasury presented the State Budget implementation report for January 1 to November 30, 2025, highlighting a 4% increase in revenue and a 4% decrease in expenditure when compared to the previous year. The revenue for 2025 was pound 11.75 billion, up from pound 11.28 billion in 2024, while expenditure was pound 13.01 billion, down from pound 13.60 billion in 2024.
The report noted that the projected rise in revenue was driven by increases in direct and indirect taxes, amounting to pound 0.27 billion and pound 0.17 billion, respectively. Conversely, the anticipated reduction in expenditure was largely attributed to lower loan repayments, which decreased by pound 0.76 billion, although social benefit expenditure increased by pound 0.15 billion.
By the end of November 2025, state revenues had reached pound 8.60 billion, representing 73% of the budget (down from 82% in 2024), and actual expenditure was at pound 9.59 billion, corresponding to a 74% implementation rate (up from 71% in 2024). The decline in revenue implementation was primarily due to a reduction in borrowing by pound 1.05 billion, which was offset by increases in direct and indirect taxes. Conversely, the slight increase in expenditure implementation was mainly due to an uptick in transfers and subsidies.
In detail, indirect taxes saw a 4% increase, with VAT revenues rising by pound 0.07 billion, and other indirect taxes and excise duties also experiencing modest increases. Direct taxes grew by 6%, mainly from corporate and personal income taxes, and loan withdrawals by November were pound 0.09 billion, a significant drop from the previous year.
Expenditure on salaries, pensions, and gratuities showed a slight decrease, while loan and interest repayments decreased from the previous year. Social security expenditures increased by pound 0.05 billion due to higher subsidies to various funds, and transfers and subsidies saw a 9% increase, driven by greater grants to municipalities and contributions to national resources.
The Treasury also noted a decrease in operating and other expenses, alongside an improved implementation rate for development expenditure. Capital expenditure by November reached pound 326.7 million, primarily allocated to infrastructure projects such as roads and government buildings. Co-financed projects and financial expenditures amounted to pound 190.4 million, supporting various social and infrastructural initiatives.
In the category of sponsorships, contributions, and grants, the implementation amounted to pound 203.8 million by November, with significant sponsorships directed towards educational institutions and research entities. Social benefits totaled pound 90.2 million, supporting renewable energy initiatives, voluntary organizations, and welfare programs.
Over the past decade, the average implementation rate for development expenditure has been 50%, with the 2025 rate improving to 56%, aided by a reduction in the initial budget. The report concluded that these financial dynamics reflect ongoing adjustments within the state's fiscal planning.