Divergent opinions over the new Fiscal Code

The decision by president Klaus Iohannis to reject the new Fiscal Code and send it back to Parliament for debate has sparked discontent in the ranks of the left-wing government in Bucharest

Ştefan Stoica, 20.07.2015, 13:14

President Klaus Iohannis has motivated his decision not to endorse
the new Fiscal Code by saying that the measures of fiscal relaxation it
provides for will significantly impact the budget structure. The new Fiscal
Code should promote policies leading neither to excessive taxation nor to
increased relaxation, president Iohannis said, in line with the serious
reservation expressed earlier by the European Commission.

The European body has cautioned over the risk that, without measures
to significantly improve the collection of taxes and duties, a cut in these
taxes, particularly in the VAT, might lead to an excessive deficit, which could
run against both the European regulations in this field and the agreements
Romania signed with the IMF as part of the latest precautionary loan accord.
The president’s decision sparked heated reactions from the ruling coalition.
Prime Minister Victor Ponta described the president’s decision as running
against national interest.

The Social-Democrats, number one in the government, have lashed out
at the main opposition party, the National Liberals, whom they have accused of
excessive politicizing. Rovana Plumb, who is the interim chairman of the Social
Democrats after Victor Ponta stepped down from this position due to his being
under criminal investigation, said that:

Rovana Plumb: From my point of view we are seeing a huge
political charade. It’s an incredible insolence of political partisanship on
the part the new National Liberal Party, which is reneging on its own vote in
Parliament. Now they don’t admit they have taken part in all the consultations
and debates in the expert committees over this document, nor do they recognize
their contribution to this Fiscal Code or their endorsement of it.

The Liberals in turn recalled that, in
spite of the yes vote in Parliament to a fiscal code which was supposed to be
business-friendly, they have always voiced doubt regarding the sustainability
of the envisaged tax cuts. Stung by the harsh tone of the Social-Democrat
chairwoman, Alina Gorghiu, co-chair of the National Liberal Party, has suggested
that Rovana Plumb should not copy the Prime Minister’s stylistic discourse, but
have a more elegant one. On the other hand, the Liberals are backing the
alternative of a special Parliament session entirely devoted to reassessing the
new Fiscal Code, and are vehemently rejecting the idea that the government
should assume responsibility for the bill.

Alina Gorghiu: It would be tantamount to mocking the Romanian
people, the business environment in Romania, to assume responsibility for a
projection, when you no longer have the consensus of political forces. Why?
Because you fail to ensure legislative stability on medium and long term.

What was supposed to be a debate on
policy issues slid into domestic politics as usual, fraught with impassioned discourse
and arguable political stances.