July 25, 2017 UPDATE

Government of Romania gives up plans to introduce solidarity tax

Newsroom, 25.07.2017, 19:38

STATEMENT – The impact of Romanias purchasing Patriot missiles will be strong, contributing indirectly to the defence of the neighbouring states and of NATO, the US Ambassador to Romania, Hans Klemm, has said in an interview with the public television. According to Ambassador Klemm, there is no reason that this move should cause tensions with Russia, as the purpose is strictly defensive. Klemm has also said that the purchase of Patriot missile is part of Bucharests commitment to earmark 2% of the GDP for defesnse, a commitment that the US firmly supports. We remind you that a Pentagon agency, quoted by Reuters, announced that the US Department of State approved two weeks ago a possible sale of Patriot missiles to Romania, worth 3.9 billion dollars.

TAXATION – The leftist Government of Romania has given up the solidarity tax, a measure included in the governing programme, and which had been planned to apply for high-income taxpayers. The announcement was made on Tuesday by PM Mihai Tudose, who said that according to simulations conducted in this respect the measure would not yield the desired outcomes. For the time being, no other taxation changes are planned, he added. The Government has also recently announced giving up the planned replacement of the profit tax with a turnover tax.

INFRASTRUCTURE – The European Commissioner for Regional Policy, Corina Cretu, has approved the funding of 3 road infrastructure projects in Romania, in which over 400 million euros will be invested. These projects, financed by the EU, are designed to improve road security, to contribute to the economic development of the regions in question and to strengthen the countrys territorial cohesion, Commissioner Cretu explained. The 400 million euros will be provided from the EU cohesion policy funds.

HEALTHCARE – The Romanian Healthcare Minister, Florian Bodog, announced that on Wednesday he would present PM Mihai Tudose with a report on the measles vaccination campaign. The number of deaths caused by measles has reached 32, according to the National Centre for Infectious Disease Monitoring and Control. Romania is facing the most significant measles epidemic of the past few years, with 8,000 cases reported so far.

LEGISLATION – A bill regulating the police profession in Romania will be ready by October, when it will be subject to public debate, in view of ensuring enhanced authority for the law enforcement professionals, the Interior Minister Carmen Dan announced. She said she would like the bill to do away with the constraints that currently make police officers reluctant to using their weapons. The talks were generated by an incident in which police officer Sorin Vezeteu was killed on Thursday night in a train station in Suceava, northern Romania, by a 24 year old. According to camera footage, the young man came to the policeman and stabbed him several times.

POLL – 1.1 million Romanians plan to leave the country in the following five years and 2 million want to move to one of Romanias big cities, according to an opinion poll mentioned in a report dubbed Magnet Cities conducted by the World Bank. The report also says that Bucharest, Cluj-Napoca, Timisoara and Brasov are the most attractive cities for most people who want to move. Respondents in the urban area have said they want to move abroad, while people from rural areas want to move to cities in Romania. Also, most men want to go live abroad, while most women prefer to move somewhere in a Romanian city.

DEPRECIATION – Romanias domestic currency, the leu, will depreciate in the following 12 months to an average value of 4.6 lei/euro, while the inflation rate will stand at 2%, according to a release of the Chartered Financial Analysts (CFA). In the month of June, CFA Romanias macroeconomic confidence index went down as compared to the previous month, to 60 points. The CFA Macroeconomic Confidence Index was first released by CFA Society Romania in May 2011 and is an indicator that aims at quantifying anticipations of the financial analysts on economic activity in Romania. The Index can have values between 0, which means no confidence, and 100 points, ​which means complete confidence in the Romanian economy.

(translated by: Ana-Maria Popescu)