2024 will bring rising prices and reduced purchasing power, although producers and consumers will also look for solutions, according to Feliciu Parasciv, vice-president of ANCMMR (National Association of Small and Medium-sized Traders of Romania).

“From this year, we will have a series of measures, such as an increase in VAT on products that contain sugar in a certain amount, on organic products, mountain products – those produced at an altitude of 1000-1400 m, there will be a tobacco excise tax. increase, on alcohol, on drinks with a higher concentration of sugar, some micro-enterprises will have higher turnover taxes, there will be an increase in taxes for banks, hotels, restaurants. In the market, the increases will be larger because they will be passed along the chain.

We will see the phenomenon of falling trade, consumers will start buying cheaper products, producers will in turn reduce the quantity to keep the price at the limit. In addition, we have packaging legislation, a very big headache, which ultimately leads to an increase in costs and prices on the shelves, and on the other hand to a decrease in purchasing power,” Parashchiv said at the “2024” online debate between populists . Electoral Temptation and Budget Pressure,” hosted by the Coalition for Freedom of Commerce and Communications (CLCC).

Winter is like summer

“In December – like in July, when there were rumors about the tax package. The last time I saw the Minister of Finance at the debate, he said that in 2024 there will be no changes, but adjustments are not excluded and we can skip the measures that have been taken so far. So nothing will change, but it will change here and there, probably in significant moments. Again in the press all kinds of news from sources about various amendments to the amendments and all kinds of controversies. That’s why winter is like summer,” said Gilda Lazar, director of corporate affairs and communications for JTI Romania, Moldova and Bulgaria, during the online debate “2024: between populist election temptation and budget pressure” organized by the Free Trade Coalition. and Communications (CLCC).

According to the same source, it would be a mistake to focus on receiving funds from the PNRR when building the budget, especially since these funds are not all non-refundable, but also include loans.

“I have heard statements that we cannot lose European funds for the sake of predictability. The budget is based on arithmetic, not economic principles. We are going to spend the end of the year with our feet in cold water, analyzing proposals that appear today with the possibility of implementation tomorrow,” said Dan Schwartz, a tax consultant.

“The fiscal budget strategy for 2023-2025 for the current year foresees an increase in revenues from tobacco excise taxes by exactly 7.1%. So, the Moor fulfilled his duty and would like to continue to fulfill it. But for this we need stability so that we can plan our business. The five-year schedule for raising excise taxes on tobacco products established last year has been changed: excise taxes are increasing more than planned and faster. Recently, words like predictability or stability have become archaisms. Instead, the current vocabulary includes other, more progressive terms, such as “train”. Rather, it is a sledgehammer, or even a sledgehammer that risks derailing,” added Gilda Lazar.

“If 2024 will be difficult and crowded because it is an election year, then in 2025 we will get the bill. Then the pre-election fever will pass, and regardless of who wins the election, the widened and deepened budget hole will have to be filled,” concluded Gilda Lazar.

Laurian Lungu: Fiscal Chaos and the Growth of Bureaucracy

“This is fiscal chaos and an increase in bureaucratic processes. We’re seeing acceleration through a flurry of legislation that starts and stops and through special measures. All this will slow economic growth and make Romania less attractive. In 2005, before joining the European Union, tax cuts brought many companies from Europe to our country. Now we will witness the reverse process,” said economist Laurian Lungu.

For Sorin Orzac, first vice-president of the National Union of Romanian Employers, the direct and real involvement of the business environment in the board is the key to solving the problem of slowing economic growth and legislative chaos: “From our point of view, as entrepreneurs, it is clear that people have less and less and less money, they spend more carefully. In Germany, I saw queues for shops with cheap products, and almost no one for ordinary ones. Two categories remain – those who are very careful about the budget, and those who can afford to buy expensive products anyway. The middle class is starting to disappear in Germany, it is obvious that a similar phenomenon will happen here. We must take the initiative and get involved. Because we all know how to do in our fields. And let’s have a dialogue with the governors, make productive proposals, complain less and call on politicians to abandon populism. The idea is to be listened to and become a force.”