Taxes will go up, that’s for sure. This is also recognized by the Minister of Finance Marcel Bolosh in an interview with HotNews.ro. The reason: there is not enough money in the budget, the expected deficit is not fulfilled, pensions and salaries of state employees are increasing.

Bolosh says that some measures have already been developed. It is about the taxation of PFO, micro-enterprises, as well as the increase of VAT on certain goods and services, the maximum rate of which is 19%.

There are also calculations for collecting fees from banks and large companies. The latter, according to the Minister of Finance, will operate for a limited period

In addition, in an interview with HotNes.ro, Bolosh for the first time announces changes regarding the creation of companies or the tripling of certain fines. We will also find out what will happen to e-Invoice from January 1, as well as what he thinks about the progressive tax.

• Triple fines and an increase in the authorized capital for the second company are measures that the Ministry of Finance is preparing for evaders

Some measures should apply from October, others – from next year.

Why should we pay higher taxes?

The answer of the Minister of Finance was as follows:

• “Because we undertook a commitment with the European Commission to establish a budget deficit of 4.4% of GDP at the end of the year. From the analysis of this trajectory, this trend that we have at the moment, there is concern that we will end this fiscal year with an estimated budget deficit of about 6.87% of GDP.
• Therefore, the urgency of these measures is related to the evolution of the budget deficit, and for the next year – to the fulfillment of the obligations we have through the National Recovery and Stability Plan.
• Next year, in addition to reducing the budget deficit, we have to implement a general pension reform with an estimated impact of around 15 billion lei.
• We still have a single salary reform, where the general goal and the main pillar, I would say, is the increase in teachers’ salaries, and here again we have a budgetary impact of about 10 billion lei.
• So the constraints, both this year and next year, to be able to provide the necessary resources for these commitments mean that we can take these steps today to be able to continue with the National Recovery and Resilience Plan and to be able to use money from cohesion policy.
• We are paying this money today so that Romania can implement investments that are in the interests of the citizens.
• (…) The better our teachers are paid, the higher the level of their professional training, the more the quality of the educational act improves significantly.”

What charges were brought

VAT agreed:

• “Do not increase VAT on thermal energy, do not increase it on firewood, do not increase it on products, do not increase it on medicine (5% does not remain like that)”
• “These are really foods with a high sugar content, more than 10g per hundred grams of food product, which really fall into the zone of the standard VAT rate of 19%”
• Sales of houses with a ceiling of 600,000 lei and 120 m² increase from 5% to 9%
• “We are discussing the areas of mountain tourism and cable transport, where we have a standard VAT rate (increasing to 19%).
• “Amusement parks, leisure parks, amusement parks: all these activities will be subject to VAT at 19% (currently no 5%), “large-scale outdoor entertainment will also be subject to VAT at 19%”

No final decision has been made regarding the increase in VAT on gyms. One of the proposed scenarios involves an increase in VAT from 5% to 9%.

How will microbusiness taxation increase

“The income ceiling of 300,000 lei is used for the percentage rate of income tax, respectively:

• up to 300,000 lei, the microenterprise profit tax will remain at 1%
• over 300,000 lei, up to 2.5 million – the income tax rate will be 3%”

According to the minister, the ceiling for micro-enterprises does not change, it remains 500,000 lei.

In addition, according to him, a rate of profit of 30% is introduced, “because it is believed that this rate of profit will be a reference indicator from which we further believe that the micro-enterprise is used as an area of ​​fiscal optimization.”

h4: Why small business taxation will increase

“From this point of view, the heated discussions we had about micro-enterprises started from the context in which we find ourselves today with 390,117 micro-enterprises, a turnover of 250 billion lei, a net profit of 66 billion lei and 2.5 billion paid to the state budget. Practically, EUR 500 million of income tax is paid on EUR 15 billion of net profit,” Bolos also showed.

CASS will be paid by construction, agriculture and the food industry

“At the EFMS, we were forced to take measures to include mandatory health insurance, because 1,200,000 people did not pay contributions to health insurance,” he says.

According to the minister, a large imbalance has been created in the Health Fund, “a budget deficit that we are struggling to keep under control, and it was unfair that we all pay this social health insurance contribution from our own money, the tip recipients are insured quality and to benefit from medical services”.

“We are discussing three areas of activity, respectively for the food industry, agriculture and construction, which, despite the fact that it was a widely discussed topic, we still need to enter the norm, at least out of respect for other participants and, further, by the efforts of the state “, said the Minister of Finance.

PFAs will have two health limits

“For authorized individuals, since we are talking about them, we will set CASS at the amount of net income received, but not less than six minimum wages per household and no more than 60 minimum wages per household per year. This means that anyone who exceeds the amount of 60 minimum wages per economy pays CASS in respect of 60 wages. Therefore, there is no additionality, no additional contribution to health insurance,” he says.

According to him, the ceilings of 12 and 24 salaries at the CASS are disappearing.

“This is our innovation for authorized individuals. There are 373,000 authorized individuals who generate an income of approximately 14 billion lei, and in this context we have established these rules on social health insurance contributions and the mechanisms by which contributions can be made so that there is proportionality between social health insurance contributions insurance and medical services used by an authorized individual,” Bolos also noted.

Taxation of banks from 1% of turnover: still being modeled / Proposed to be applied for a limited period of time

“We tried not to increase, but to strengthen the mechanisms of this 1% of the turnover and we are trying to add it to the income tax,” Bolosh said, referring to the taxation of banks.

• “The turnover for the banking system is established differently than for the non-banking system, or the financial system, and here we mean the specifics of the turnover of the banking sector.”
• “These days, at the ministry level, the modeling is done based on the real data that we have in the banking system, and I think the right decision should be made after we see the real impact.”

“I would not like to destroy the banking market and the entire banking system. I would like everything to continue in its natural way,” he said.

However, he says that he did an analysis starting from 2018-2019 until today: “the income tax paid by the banks has been consistently the same.”

• “Regardless of the change in the net profit obtained by the banking system, the income tax arrears did not exceed the limit of 300 million lei, i.e. 200 to 300 million lei per year. And then a natural question arises: what is happening? Why do we seem to have a flat rate of income tax paid by the banking system?”

The coalition will propose application for a limited period of time, but with entry into force on January 1, 2024.

“Banks have the opportunity to prepare their business plans, and we also have this time slot to check the support of the banking environment. Our goal is to attract additional money to the budget, not to create an enemy of investment and economic development of Romania from the fiscal system,” he said.

Large companies are charged an additional fee

In the new version of the project, it is proposed to tax large companies with two thresholds per turnover, if the income tax is lower or they are unprofitable.

Regarding this issue, Marcel Bolosh says that the tax will also be applied for a limited period, as for banks, starting from January 1, 2024.

“No one wants to unfairly take taxpayers’ money, but everyone wants to see taxation being fair,” he explained.

• I will give an example, a shopping center with a turnover of 20 billion lei has fiscal losses.
• The first question is: why is this happening? This is a huge turnover, and the financial result is a loss.

“And of course, here it would be right for ANAF to have the necessary capacity to carry out tax control, tax audits. But now we have limited institutional capacity of ANAF and during this period, until we succeed in strengthening the institutional capacity of ANAF, we need this form of support,” Bolosh stated.

• “Nobody wants to take taxpayers’ money unfairly, but everybody wants to see taxation fair.”