On Wednesday, the government will discuss in the first reading the draft law with new increases in fees and taxes, for which it will take responsibility in the parliament. “We cannot allow the country to fall into the abyss because we have to be predictable. We have an exceptional situation, and we had to take exceptional measures,” says Prime Minister Marcel Cholaku.

The Prime Minister announced on Wednesday at a joint conference with Transport Minister Sorin Grindeanu that the new tax increase bill will be discussed in the first reading at the cabinet meeting today.

The government meeting will take place at 5:00 p.m., the executive has officially announced, confirming information presented a day ago by HotNews.ro.

VIDEO Cholaku: We can’t let the country fall into the abyss because we have to be predictable

• “At the moment, all the things that are contained in the law on assumptions, which I want to hold today at the meeting of the Government, being in the first reading, agreed in the Coalition, are assumed, taking into account the context in which we are. . I did not want that after 2 months in the position of prime minister I would take measures to amend the Fiscal Code.” stated to Cholak.

According to him, there are some fiscal measures with the help of which the state is trying to reach the deficit target, otherwise there is a risk of losing European funds.

The Prime Minister was irritated by journalists’ questions about the lack of fiscal predictability, given that certain fiscal measures will be effective from October 1, 2023.

• “You know that if we have recommendations from international tax forums, we can take certain measures, we cannot allow the country to go into the abyss, because we have to be predictable. That’s why we tried through these dialogues with everyone to see what comes into effect in October, what from January.
• I repeat, we are talking about fiscal measures, not fiscal reform, which, from my point of view, should be given 1 year before implementation. But we have an exceptional situation, and we had to take exceptional measures.” said to Cholak.

Transport Minister Sorin Grindeanu said that the urgency of these measures, which include, in addition to the increase in fees and taxes, measures to reduce budget costs and fight tax evasion, is due to the danger of losing European funds.

• “The Ministry of Transport does not have a single important project that could be implemented without EU funds. I think no minister can afford a scenario where EU funds are suspended if we don’t hit the deficit target.” – said to Grindyan.

Cholaku: No normal country can continue like this! We have the lowest incomes and the most evasions in the EU

Marcel Čolaku nervously answered when journalists asked the doim that they would explain to construction companies that some measures would be in effect from October 1.

• “There are 500 changes to the Fiscal Code due to 100 laws and extraordinary resolutions. No normal country at all can continue like this when tax breaks are hiding the country. We have the lowest construction income to GDP in the EU. We have dozens and hundreds of tax breaks, but instead of a low rate of tax evasion, you actually have the lowest incomes and the highest rate of evasion. It can’t go on like this.” – said Marcel Cholak.

Čolaku: We have the largest tax evasion in the EU, more than 10% of GDP, i.e. 160 billion lei

The Prime Minister was asked how the treasury will collect funds for the budget from 70% taxation of undeclared income, when it also collects declared income poorly.

• “That doesn’t mean we shouldn’t collect, we shouldn’t fight evasion. I am sad to report that we have the largest tax evasion in the EU, over 10% of GDP, i.e. 160 billion lei. This is reality. This is not a single measure, there are many measures to combat evasion.” said to Cholak.

Cholaku, about raising taxes: Nowhere in Europe is it encouraged to give children sweet foods

To journalists’ insistence on tax increases, Çolaku claimed that they would actually be normal, “according to European logic.”

• “Where are the tax increases? They are normal, according to European logic. Nowhere in Europe is it encouraged to give sugary foods to children. VAT is the same.
• I don’t agree with clubs putting 5% VAT on books and prostheses. The state cannot and I do not believe that the state should deal with sports clubs. There are still 5% left at the theater performances. (with VAT)”, said to Cholak.

Cholaku: I don’t think we’re going to do away with banks because they’re overpriced / a veiled threat if food prices go up

The prime minister rejected the idea that excessive taxation of banks, companies and small businesses would raise interest rates by 1% or that it could raise prices on the shelf.

• “This is not a direct connection. I think in 1992, when I was active in the private sector, my first loan was at 158%. Such was the interest then, and I survived. It has nothing to do with the base rate.
• Let’s not think that the European Investment Bank will raise the reference rate because we put 1% into the banking system.
• As far as I know, the Minister of Finance has had a discussion with all representatives of the banking system, they have agreed on very specific things, and there will be no increase in interest rates. (..) I don’t think we’re going to run out of banks because of this inflation.
• It has nothing to do with products off the shelf. I would like to remind you that both medicine and food remain subject to VAT at the rate of 9%.
• I think they have increased the number of products enough. If we try to force an unjustified increase, no problem, we increase the number of products at disposal. I have no doubt, but I don’t think it is.’ also clarified the prime minister.

Cholaku essentially made it clear that if food prices continue to rise, the government will further expand the list of staples to which commercial allowances are limited.