The decision of the Supreme Court, which deems as unconstitutional the law that allowed the reductions of the salaries of the civil servants, the semi-government and the employees of the wider public sector, in order to deal with the economic crisis, creates big problems. There was no unanimity for the decision. The Government has 42 days to appeal.
It is emphasized that on the issue of reduction of earnings the decision was unanimous.
The developments are expected to be unpredictable for the Cypriot economy, since with the justification of the applicants, tens of millions will be needed to return the reductions that have not been calculated exactly and will bring the economy to new tests.
The law on the reduction of the salaries of the civil servants was passed on 1/12/2012 and entered into force immediately, after it was deemed a necessary and imposed measure to face the financial crisis and to need less support amounts. By the same law, the surcharges were reduced for two years (then they came back). This legislation was challenged in an appeal to the Supreme Court on the grounds that violates Article 9 of the Constitution which provides for a dignified lifeh. It was also argued that it was a retroactive taxation and how Article 23 of the Constitution concerning property rights was also violated, that is, no one can interfere with the right of ownership.
It was argued by the Legal Service that this measure was taken because the situation was such and concerned the salvation of the state and that the measures were fully compliant with the Constitution. It was also argued that this was a reduction in salaries and not taxation and that this did not affect the core of salaries, ie that civil servants were not deprived of their salaries, but a small part of them was cut. It was also reported that fiscal developments were such that cuts had to be made and that this was in the interest of the state. It was further stated that Articles 24 and 28 of the Constitution cover the legislation, as they state that everyone is obliged to contribute to the state finances.
Source: Philenews