July 7, 2025 UPDATE (1)
A roundup of local and world news
Newsroom, 07.07.2025, 17:58
MEASURES – The Government has assumed responsibility in Parliament, on Monday, for the first package of fiscal measures designed to reduce the budget deficit. The package received a negative advisory opinion from the Economic and Social Council, because the measures lead to a decrease in the purchasing power of Romanians and affect the stability in society. Opposition parties announced they are preparing a vote of no-confidence. The most important measures provided for in this fiscal package concern the increase in VAT from 9 to 11%, respectively from 19 to 21%, the elimination of the exemption from paying health insurance contributions for pensioners with monthly incomes exceeding €600 or the increase in excise duties on tobacco, alcohol and fuels. The norm of teaching staff in pre-university and university education will increase and the protocol for awarding school scholarships will be modified. Also, salaries and pensions in the public system remain capped, including next year. The government resorted to these measures because of the country’s very large deficit and the risk that Romania will be downgraded by rating agencies to ʹjunkʹ, i.e. not recommended for investments. Prime Minister Ilie Bolojan told Parliament that the first package of fiscal measures represents a national emergency and an act of responsibility. Romania needs to correct negative accumulations – the prime minister said. According to Ilie Bolojan, all measures taken by the government will bring equity and justice. And by the end of this month, the prime minister promises a new package of measures regarding special pensions, pension calculation and retirement age, with an emphasis, says Ilie Bolojan, on equity, morality and efficiency.
PROTESTS – Disgruntled with the solutions offered by the coalition executive made up of the PSD-PNL-USR-UDMR to curb the budget deficit, trade unions from Romania’s Healthcare and Education protested in front of the Parliament building in Bucharest. Employees of the Pension Houses, of the Romanian Waters National Administration and the Agriculture Ministry have also announced a series of protests. Trade unionists believe the Executive has chosen the easiest way out, namely to raise taxes and duties. They have submitted to the political parties their alternative for curbing the country’s budget deficit, which includes a measure under which, subsidies are to be granted to political parties only in the years when Romania meets the budgetary deficit targets set at European levels. Trade unionists also want the lump sum granted to deputies and senators cut by 50% as the present system does not offer a transparent way on how this public money is spent. On the other hand, the Confederation of Authorized Operators and Transporters in Romania has called on the government to rethink the austerity measures imposed ‘so that they may not destroy Romania in the following six months’. (VP)
