\n
<\/p>\n
Romania is one
\nof the ten EU Member States currently facing economic imbalances. This is the
\nrecommendation stemming from the European Commission’s winter report for
\nRomania which assesses the country’s progress on economic and social
\npriorities. <\/p>\n
<\/p>\n
\n
\n
\n
\n
\n
<\/p>\n
In its report
\nthe European Commission highlights the need to promote investment, pursue
\nresponsible fiscal policies and implement well-designed reforms. Challenges
\nvary significantly across countries and call for appropriate and determined
\npolicy action. As regards Romania, the report shows that no real progress has
\nbeen made concerning the fiscal framework, the minimum wage or the governance
\nof state-owned companies. <\/p>\n
<\/p>\n
\n
\n
\n
\n
\n
<\/p>\n
The European
\nCommission believes further efforts are needed in order to obtain tangible
\nresults. In its assessment, the Commission warns that the power of the tax
\nsystem to reduce poverty and correct social disparities is limited. Income
\ninequality remains one of the highest in the EU and a third of Romanians are at
\nrisk of poverty, the highest rates in the EU, the report also reads. <\/p>\n
<\/p>\n
\n
\n
\n
<\/p>\n
The document
\nalso points to the fact that the tax structure is characterized by low levels
\nof revenues, with high reliance on consumption taxes. The tax-to-GDP ratio
\nstood at 24.9 % in 2017, the lowest value since 1996. This represents the
\nsecond lowest level in the EU – well below the EU average of 39.2 %. <\/p>\n
<\/p>\n
\n
\n
\n
\n
\n
<\/p>\n
Moreover, EU experts
\nrepeatedly refer to the Government’s emergency decree no. 114, which brings a
\nseries of fiscal modifications, some criticized both by the opposition and the
\nbusiness sector. At the end of last year, without impact assessment or
\nconsultation of stakeholders, the government adopted an emergency decree
\nintroducing a new tax for banks (the tax on greed) levied on total
\nassets exceeding 2% of the interbank interest rate (ROBOR). <\/p>\n
<\/p>\n
\n
\n
\n
\n
\n
<\/p>\n
The Commission
\nsays the tax is likely to put a strain on financial stability by impacting the
\nsolvency and profitability of banks and by worsening further the situation of
\nweaker banks. At the same time, the tax could also impact credit activity and
\nreduce flexibility for monetary policy. The European Commission report shows
\nthat the measures stipulated by decree no. 114 weaken the second pillar of
\npensions based on defined contributions. <\/p>\n
<\/p>\n
\n
\n
\n
\n
\n
<\/p>\n
The measures
\nhave a negative impact on Romanians’ future pensions and will hamper the
\ndevelopment of the capital market and future investment, will increase
\nuncertainty and make Romanian economy less attractive for both domestic and
\nforeign investors. <\/p>\n
\n
<\/p>\n","protected":false},"excerpt":{"rendered":"
Romania is experiencing economic imbalances, the European Commission has warned<\/p>\n","protected":false},"author":46,"featured_media":80846,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[37738],"tags":[29120,31693,32613],"coauthors":[],"class_list":["post-80845","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-today-in-the-news","tag-eu","tag-gdp","tag-robor"],"acf":[],"yoast_head":"\n