The impact on profits caused by the application of the minimum turnover tax, according to the new fiscal measures announced by the executive, ranges from 35% for FMCG companies to 83% for cigarette distribution companies, which means doubling the current tax, according to the Romanian Goods Distribution Association ( ACDBR).

“Based on the signals received from members in the territory and the conducted analysis, we draw attention to the fact that the sales tax will have a negative impact on the economic sector of goods distribution, and therefore on the national economy. We note that such taxation cannot be supported by FMCG distribution companies, where the rate of profit, depending on the products distributed, is on average from 0.47% to 3.4%,” the association notes.

The application of such taxation in the traditional sector of distribution of consumer goods would have a negative impact on the activities of companies that are members of the ACDBR, and not only, but also on traditional trade, that is, small retailers and HoReCa enterprises in our country. country.

“Currently, in real terms, the profitability of a distribution company in the field of tobacco products (goods that, after oil products, bring the highest value from excise taxes to the state budget) is from 0.47% to 1.37%. , and the company engaged in the distribution of beverages and food is from 1.5 to 3.4%. However, the application of a tax rate of 1% on turnover exceeding 50 million euros will complicate the financial situation of distribution companies, making this activity virtually unprofitable and blocking the supply of more than 60,000 companies from the traditional market and the HoReCa sector. Our analysis of cigarette, food and beverage distribution companies shows that the impact on profits from the application of IMCA ranges from 35% for FMCG companies to 83% for cigarette distribution companies, which amounts to doubling the current tax. In addition, due to the seasonality of the first five months of the year, most distribution companies record losses that are compensated in the following months of the year,” the association notes.

By applying an IMCA (Minimum Turnover Tax) of 1%, companies will pay a very high quarterly tax without making a profit, reducing the capitalization and liquidity needed to support the business in the market, generating bank loans to maintain cash flow and automatically higher costs.

“That is why I sent an appeal to Mr. Prime Minister Marcel Čolak, the government and political decision-makers in the parliament, with which we propose that companies operating in the economic sector of the distribution of FMCG goods should be identified with CAEN codes: 4631, 4632, 4633, 4634 .the traditional trading market, which is dominated by the majority of insolvencies and closures,” ACDBR notes.

The new minimum turnover tax will apply to businesses involved in the distribution of goods after the Government, through GEO 67/2023, raised the maximum cap on commercial allowances to 14 major food products across the distribution chain, according to association officials. at the level of 5%, which has already caused a decrease in the profitability of economic agents in this sector of activity.

“At the same time, we believe that the increase in excise taxes on beer and cigarettes will lead to a consistent decrease in consumption (which can be observed already this year), which will affect the volume of sales, giving rise to the restructuring of activities, a fact that has a direct impact on the release of personnel, thus increasing unemployment rate and thus causing a chain effect on the national economy. We pay attention to these aspects, because the traditional distribution of consumer goods plays a decisive role in ensuring the continuity of economic processes, as it completes the activities of the producer, completing the production cycle and providing financial resources for the recovery of economic activity,” they note.

Distribution of goods is a major activity with an important function in the economic process.

“Furthermore, by taking on the role of collecting, sorting, storing and selling goods to end sellers in the food chain, traditional distribution of consumer goods also plays an important link in ensuring food security. tested by the successive events of recent years caused by the COVID-19 pandemic and the Russian invasion of Ukraine, contexts that have led from an energy crisis to an economic one that has affected and continues to affect Romanian distributors. And last but not least, we show that traditional distribution is a fundamental link for traditional trade and, therefore, for our national economy,” say representatives of the Association of Romanian Goods Distribution Companies.

The Association of Romanian Commodity Distribution Companies (ACDBR) is a member of the National Council of Small and Medium-sized Private Enterprises of Romania, at the moment it has 38 members with internal capital, operating in all 8 regions of the country’s development and through them accumulating the following main characteristics: total turnover approx. 2 billion euros, a market share of about 40% of the total distribution market of traditional goods, about 15,000 employees, a fleet of about 10,000 vehicles.