Cyprus’s fiscal surplus rose to 1,609.7 million euros in the first nine months of 2026, equal to 4.0 per cent of GDP, from 1,167.6 million euros, or 3 per cent, in the same period last year, according to the Statistical Service (Cystat).
Total revenue increased by 6.5 per cent to 12.1 billion euros, while total expenditure rose by 2.9 per cent to 10.48 billion euros. Capital spending, however, fell by 189.9 million euros, or 16.9 per cent, and net investment in fixed assets such as roads, buildings and infrastructure dropped by 12.1 per cent.
The figures show the state collecting considerably more revenue while spending less on long-term infrastructure, with most of its spending increase going on social benefits, staff pay and day-to-day running costs.
Revenue
Taxes on income and wealth, which include company profits and individuals’ income, rose by 15.3 per cent to 3,337 million euros.
Net VAT revenue increased by 293.1 million euros, or 12.5 per cent. Higher prices appear to be adding to state revenue, as VAT rises with consumer prices.
Social contributions rose by 235 million euros, pointing to a stable labour market.
Capital spending
Lower capital spending holds down costs in the short term but can weigh on the economy’s longer-term growth.
Such falls are often not a deliberate policy choice but a sign of difficulties in implementing the budget, as bureaucracy, delays in tenders or legal disputes between contractors can hold up budgeted projects and leave approved funds unspent.
Spending
Social benefits accounted for most of the rise in spending, growing by 4.9 per cent to 4,268.9 million euros.
Compensation of employees rose by 108.3 million euros, or 3.8 per cent, to close to 3 billion euros, while intermediate consumption, the goods and services the state buys to operate, jumped by 11 per cent.
By sector
The central government’s surplus more than doubled to 656.3 million euros, from 306.8 million euros a year earlier, and social insurance funds recorded a surplus of 957.2 million euros.
Municipalities and communities narrowed their deficit to 3.8 million euros, from 30.7 million euros in 2025.
