June 5, 2025 UPDATE

A roundup of local and world news

Newsroom, 05.06.2025, 20:00

NEGOTIATIONS Negotiations continue in Bucharest in the governmental task force on fiscal measures, coordinated by president Nicușor Dan. The pro-European parties in Parliament (the Social Democratic Party, the National Liberal Party, Save Romania Union and the Democratic Union of Ethnic Hungarians in Romania), which could form the new government, are looking at several fiscal measures, in order to identify the areas from which more money could be collected to the state budget in the shortest possible time. The options under analysis include raising the standard VAT rate from 19% to 21%, with possible exemptions for food and medicines, which would have a reduced VAT rate of 5%. Another proposal is to increase the dividend tax from 10% at present to 16%. In addition, pensions above EUR 500-600 could be subject to a 10% healthcare contribution (CASS), while copyright contracts would be subject to both healthcare and social security contributions. Stock transfers and income outsourcing could be taxed at 2%. There is also talk of a 16% solidarity tax to be paid by those with incomes above EUR 2,000, a measure to be implemented by the end of this year. Last but not least, an increase in excise duties is also being discussed, not including excise duties on fuel, as well as the taxation of crypto-currencies and an increase in taxes on gambling. All these issues are only being discussed for the time being, with the final package of tax measures to be decided later. The measures are to be implemented as of July 1 and are designed to tackle excessive macroeconomic imbalances.

DEFICIT The European Commission’s semester analysis shows that Romania is the only country in the European Union with excessive macroeconomic imbalances and which has not taken any effective measures compared to what it has undertaken to do. According to the Commission, the deepening deficit was caused, among other things, by an increase in current expenditure, public sector salaries and pensions. Brussels calls on Romania to come up with quick and effective measures, otherwise it risks not meeting the deficit correction targets by 2030 and may enter procedures that will lead to a loss of European funds as of next year. The executive vice-president of the European Commission Roxana Mînzatu said the situation is serious, but any risk can certainly be avoided if Romania’s new government sends its proposals for deficit reduction.

SALT MINE In Praid, in central Romania, 8 international experts are working alongside their Romanian counterparts to find solutions to make the area safe, after the salt mine was severely affected by floods at the end of May. Temporary evacuation measures for the population remain in place, but people have access to their homes during the day for routine activities. In the perimeter of the old salt mine, craters have expanded in the last 24 hours, both horizontally and vertically. Local authorities say that their expansion does not endanger the efforts to redirect the Corund stream. To this end, trees have been cleared with the consent of the forest guard, and the contractor has started excavations on the riverbed in the area where pipes will be installed. The flow rate of the Corund stream is decreasing and the salinity measured at the points of interest has not increased. Over 300,000 litres of drinking water have been supplied to the 16 villages in Mureş County affected by the increase in the salinity of the Târnava Mică River.

PETITION Over 123,000 people have so far signed a petition initiated by the civic organisation Declic, which calls on the president of Romania Nicuşor Dan and on Parliament to appoint independent and principled judges to the Constitutional Court. Declic emphasises that political appointments and the lack of transparency in the selection process can lead to an institution that serves party interests rather than the Constitution, and demands that appointments be based on clear and transparent criteria, in order to ensure the protection of the fundamental values ​​of democracy. The organisation is concerned with the Court’s recent decision to cancel the obligation of public office holders and civil servants to declare their wealth and interests, the Court’s unwillingness to revise the special pensions system and the decision to cancel the presidential elections based on classified documents. Declic mentions that the terms in office of 3 the constitutional judges end this month, and their replacements for a 9-year term will be designated by the Presidency, the Senate and the Chamber of Deputies, to whom the petition called “We want independent judges at the CCR!” is addressed.

FRANCE The French Ambassador to Bucharest, Nicolas Warnery, made a number of clarifications on Thursday, following misinformation spreading online. The French diplomat denied any involvement of France in the election process in Romania, as circulated on social networks. He stressed that the head of the French secret services did not come to Romania at all during the elections, and the French military in Cincu did not prepare any kind of coup. “This is not their mission, they are seconded to Romania to defend this country,” Warnery pointed out. According to the ambassador, France is the target of a campaign benefitting Russia, because Paris campaigned for peace talks in Ukraine and President Emmanuel Macron and the government in Paris have publicly stated that what happened in Romania during the presidential elections in November 2024 was a hybrid attack by the Kremlin.

NATO NATO defence ministers met in Brussels today to discuss the Alliance’s defence needs, in a last meeting before the NATO summit in The Hague later this month. NATO’s secretary general Mark Rutte said the alliance’s new defence capabilities plan will be approved to further deter any attack on a member state. The plan will determine exactly how much investment is needed and how much the Allies’ defence budgets need to increase. Regardless of the exact figure, which could be between 3% and 5% of GDP in the long term, Rutte said the future formula must balance costs between the United States on the one hand and Europe and Canada on the other. The US defence secretary Pete Hegseth welcomed the fact that European allies have already increased their defence budgets. He reconfirmed the US commitment to NATO, but again pointed out that Washington must also be present in the Indo-Pacific region to protect its security interests, hence the need for fair participation in NATO financing by all Allies. (AMP)