Priorities of the Romanian Government

After being submitted to public debate for one month, the new draft Fiscal Code and Fiscal Procedure Code are high on the agenda of the Romanian Government. The new Fiscal Codes provide for substantial cuts in taxes and dues and are to be enforced as of next January, the Romanian Prime Minister pointed out. In a discussion with foreign journalists accredited to Bucharest, Prime Minister Ponta tried to dispel the fears that the new fiscal regulations might allow for the increase of certain local dues, making it clear that the new Fiscal Code would let local officials decide on their value.

Corina Cristea, 18.03.2015, 14:01

After being submitted to public debate for one month, the new draft Fiscal Code and Fiscal Procedure Code are high on the agenda of the Romanian Government. The new Fiscal Codes provide for substantial cuts in taxes and dues and are to be enforced as of next January, the Romanian Prime Minister pointed out. In a discussion with foreign journalists accredited to Bucharest, Prime Minister Ponta tried to dispel the fears that the new fiscal regulations might allow for the increase of certain local dues, making it clear that the new Fiscal Code would let local officials decide on their value.

Victor Ponta went on to say that a possible cut in taxes and dues would not change the 2015 fiscal deficit target standing at 1.8% of the GDP. The Prime Minister did not rule out the possibility for fiscal relaxation to be applied even this year, underscoring that after the first quarter, the state budget had a surplus of one billion Euros. The taxes on dwellings, lands and cars will go up when the new codes take effect. In exchange, the list of products on which a 9% VAT is enforced is going to be extended and in addition to bread it will also include meat, fish, vegetables, fruit, milk, eggs, livestock and poultry.

The new Fiscal Code provides for the VAT to go down from 24% to 20% in 2016 and to 18% in 2018. Arguing that, “sport is a social and economic phenomenon of great interest to the population, the government introduces a 9% VAT on access to sporting events. The draft Fiscal Code also stipulates that people choosing to get a divorce by administrative channels, at the city hall, will have to pay a higher fee and mayors can also increase that fee by up to 50% as compared to only 20% at the moment. Prime Minister Victor Ponta made it clear that a first analysis would be made and next week, the Government would endorse the Codes and submit them to Parliament for debate.

The passing of the two Codes is considered instrumental to economic development and sustainable economic growth. Consequently, the Prime Minister has decided that the resignation handed in last Sunday by Finance Minister, Darius Valcov in charge of drawing up the Codes take effect only after the draft Codes have been finalized. Valcov is being prosecuted for corruption when he was mayor.