Cyprus is making changes to its tonnage tax system to encourage owners to operate greener ships.
The Cyprus shipping deputy ministry has announced a new range of green incentives to reward vessels that demonstrate effective emissions reductions. From the fiscal year 2021, annual tonnage tax will be reduced by up to 30% for each vessel that demonstrates proactive measures to reduce its environmental impact.
Vessels that have achieved further reduction of their attained EEDI compared to the required EEDI will obtain the respective annual tonnage tax rebate of between five to 25%.
Flag states are well-positioned to support shipowners in making sustainable shipping choices
Ships which demonstrate reduction of the total fuel oil consumption in relation to the distance travelled, compared to the immediately previous reporting period will obtain an annual tonnage tax rebate of between 10 to 20%.
Vessels using an alternative fuel and achieving CO2 emissions reductions of at least 20% in comparison with traditional fuels will receive a rebate on annual tonnage tax of between 15 to 30%.
Any vessel detained for any reason during PSC inspection, that violates any regulation of European Commission related to the environmental protection, or in laid-up condition – warm or cold – during the calendar year will not be eligible for the incentive.
Vassilios Demetriades, Cyprus shipping deputy minister, commented: “As a leading maritime nation, we have an obligation to support efforts in reducing GHG emissions. We believe that flag states are well-positioned to support shipowners in making sustainable shipping choices which they can benefit from both operationally and financially. Striking the right balance between the green transformation and competitiveness is a challenge but also presents opportunities.”
Demetriades went on to urge Europe to press ahead with green shipping developments, providing a “first-mover advantage” to the EU shipping industry.
“Clear objectives for 2030 and 2050 have been set by the IMO and all industry stakeholders must unite to create a clear pathway to achieve and exceed these goals,” Demetriades said.