Passed by the
\nSenate of Romania in April, the new draft Fiscal Code drawn up by the
\nGovernment was Monday unanimously passed by the Budget Committee of the Chamber
\nof Deputies. The final vote of the Chamber on the bill is scheduled for
\nWednesday. <\/p>\n
<\/p>\n
\n
<\/p>\n
One of the key
\nmeasures involves the reduction of the standard 24% VAT rate to 19%. In the
\noriginal text, the slash was only 4%. Finance Minister Eugen Teodorovici said
\non Monday that although the new Fiscal Code would take effect in 2016, the
\nmeasure could be implemented sooner, if the returns to the public budget in the
\nfirst six months of the year allowed it. Eugen Teodorovici:<\/p>\n
<\/p>\n
\n
<\/p>\n
We are
\nanalysing, at the Ministry for Finance, the possibility of implementing this
\nmeasure earlier than January 1, 2016. Our calculations will tell us exactly
\nwhen that can be done.<\/p>\n
<\/p>\n
\n
<\/p>\n
This amendment
\nwas the argument that persuaded even the Liberal MPs, in Opposition, to vote in
\nfavour of that bill. But although he voted for a lower VAT rate, the former
\nFinance Minister Gheorghe Ialomitianu, from the Liberal Party, called on the
\nGovernment to take responsibility for the possible negative effects of that
\nmeasure, which was also received with reservation by the IMF and the European
\nCommission.<\/p>\n
<\/p>\n
\n
<\/p>\n
According to
\nexpert estimates, the measure may lead to a widening of the budget deficit by
\n2.5 billion Euros, accounting for around 1.5% of the GDP. <\/p>\n
\n
<\/p>\n
Another
\nimportant stipulation of the new Fiscal Code has to do with slashing the VAT
\nrate from 24 to 9% for foodstuffs, non-alcoholic beverages, restaurant and
\ncatering services. The measure took effect on June 1. The Government sees those
\nmeasures as a means to encourage consumption and implicitly to boost economic
\ngrowth. <\/p>\n
<\/p>\n
\n
\nThe
\ndraft Fiscal Code also does away with the special building tax as of January
\nnext year, and with the 7 eurocent excise on fuels, which pushed the petrol and
\ndiesel prices up last year. Also as of January 1, 2016, the 16% tax on
\ndividends will be eliminated, while the flat tax rate will be lowered from 16
\nto 14% starting January 2019. The IMF and the European Commission have
\nrepeatedly warned that once those fiscal relaxation measures are implemented,
\nRomania risks missing the budgetary deficit target agreed on under the current
\nstand-by loan agreement.<\/p>\n","protected":false},"excerpt":{"rendered":"
The Chamber of Deputies is to debate the Fiscal Code bill proposed by the Government and passed by the Senate in April.<\/p>\n","protected":false},"author":2,"featured_media":64114,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[37738],"tags":[116464,34297],"coauthors":[],"class_list":["post-64458","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-today-in-the-news","tag-romania-en","tag-tax"],"acf":[],"yoast_head":"\n