142 Cyprus Energy Regulatory Authority Under certain conditions interest income may be subject to defense contribution at the rate of 30%. According to the Laws Regulating the Electricity Market and related Regulations, the fees collected by the Authority by practising its supervisory role are not considered an income under the Law of Income Taxation and article 5 (1)(a), and are not subject to taxation. The same applies for the government grants the Authority receives in order to be able to perform its supervisory duties. Income from rent or other sources are subject to taxation at the rate of 12.5% and the Special Defence Contribution, after the discount deductions provided by the Legislation. Due to tax losses sustained in the year, no tax liability arises on the Authority. Under current legislation, tax losses may be carried forward and be set off against taxable income of the five succeeding years. 2021 2020 € € Defence contribution on deemed distribution 3.389 7.894 3.389 7.894 16. Dividends Deemed dividends are subject to special contribution for defence at 17% for shareholders that are both Cyprus tax resident and Cyprus domiciled.
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