Tax evasion in Romania, especially in the field of VAT, is high. The VAT deficit is €9 billion (36.7%), ie money that is not collected, these figures are valid for 2021 (this year for 2022).

Short:

• The gap in VAT is from imports, from the problem of undeclared goods

• Are electronic invoices issued at the border with Ukraine? Is it on the border with Moldova or Serbia? Nothing is done. This is tax evasion – Dan Schwartz

• I think that through a small customs office in Romania, several hundreds of thousands of euros are collected daily from this parallel trade. We look, but we cannot touch – Christian Redulescu

• At least 70% of the VAT gap comes from B2B, carousel fraud – Gabriel Biris

• Will everything be traceable via e-Seal? Taxpayers are overburdened

• The direct entry of DSI officers into ANAF led to a mess like (declaration) 088 or a campaign to prosecute entrepreneurs for the fact that they should have known that a supplier of a supplier of suppliers had stolen VAT. That is, the responsibility for the act of another – Gabriel Birish

• SAF-T was supposed to be a detailed reporting system that would eliminate many other declarations. How much did he liquidate?

• The connection of cash registers to ANAF was supposed to reduce VAT fraud

• AMEF in the Czech Republic, Croatia, Portugal means voucher applications. You don’t need cash registers

• In these countries, you only need a scanner to connect to the program, provide information and receive a unique number on the voucher

• When the Croats implemented them, they recouped their costs in 3-4 hours due to the additional VAT collected

• Are we concerned about reducing the VAT gap? Damn! We don’t care, – Gabriel Birish

“If we talk about e-Invoice, in particular, as a tool to get more money from the public budget, I think that in the end we find that in fact we refuse to look hard at where the VAT gap is coming from. Obviously, this is an import. This is related to the problem of undeclared goods and all the trade that takes place there,” said Cristian Radulescu, partner of Taxhouse-Taxand Romania.

For his part, Dan Schwartz, managing partner of RSM Romania, said: “Do you think that electronic invoices are made at the border with Ukraine? Is it on the border with Moldova or Serbia? Nothing is done. There is tax evasion. It is obvious. So why hide behind the fact that we’ve digitized everything and solved the problem? In the end, we can say that we are trying to solve a small part.”

Cristian Redulescu asked to remember the news about non-working customs scanners.

“Why don’t I go? This is if there is a problem of solving the VAT gap. This is, unfortunately, a parallel world in which we live. I think that through a small customs office in Romania, several hundreds of thousands of euros are collected daily from this parallel trade. We look, but we cannot touch,” he said at the TaxEU forum.

As for e-Seal, it seems to him that everything is left to the administrative apparatus.

“I don’t see a real possibility to check everything circulating through Romania via e-Seal. If we talk about the tax inspectors with whom we interact, we often see how much they exceed their powers,” said Redulescu.

With e-Transport, he does not believe that everything is solved, because it is only a measure, mostly to make it difficult for taxpayers who declared anyway, and now they have a greater burden.

SRI entered ANAF and fiscal aberrations appeared

“If we have any hopes of improving the collection… I personally don’t. I did some things I was proud of at first and then realized I was a fool, like getting off the national security threat list. It was a topic we discussed in 2008-2009. They put it on the threat list in 2010 and started anti-evasion measures,” said lawyer Gabriel Birish, former secretary of state at the Ministry of Finance.

According to him, “the face-to-face introduction of DSI officers to ANAF led to a mess of type (declaration) 088 or a campaign to bring entrepreneurs to criminal responsibility on the basis that they should have known that the supplier of the supplier of the suppliers had stolen VAT.” That is, responsibility for the act of another.”

Even recently, two people appeared in the Ministry of Finance. See:

A graduate of the SRI Academy, appointed Secretary General of ANAF

Former employee of the Research Institute, appointed as the Secretary General of the Ministry of Finance

“We forced everyone to buy cash registers, we did not connect them. Now we have connected them, but we do not process data, we do not do risk analysis,” he says.

According to Birish, 9 billion euros cannot be stolen from anyone.

“I requested the ANAF investigation into the fraud, but I have not seen it. It seems to me that at least 70% of the VAT gap is B2B, carousel fraud,” the lawyer explained.

What does the system of connecting cash registers mean in other countries and how it was done in Romania: there you do not need cash registers because the programs are offered

“We are now talking about e-Invoice, another idea that I thought was good, but now I think I better hold off. The process of introducing an electronic invoice was started in 2016. SAF-T was launched in 2016. SAF-T was supposed to be a detailed reporting system that would eliminate many other declarations. How much did he eliminate?”, Birish also showed.

According to him, e-Invoice, just as we wanted to do with AMEF, was supposed to invoice applications managed by ANAF.

“AMEF in the Czech Republic, Croatia, Portugal are voucher applications. You don’t need cash registers. You just need a scanner to connect to the app, you provide your information and you receive a unique number on your voucher. The Czech Republic took 6 months from inception to implementation and cost 6 million euros. When the Croats implemented them, they repaid their funds in 3-4 hours due to the additional VAT collected,” the lawyer said.

He claims that he was interested in looking at the evolution of the VAT gap across all EU countries over the past 20 years.

“You will be shocked to see that Romania is always in the top. If you look at this group of over 20 (no states) you can see it going down. Romania dominates. The VAT gap in Europe reached 5%. We have 36.7%. Bulgaria, Poland, Hungary – 5% each. I think we are the only country in the EU that had a bigger gap in 2021 than in 2020,” Birish says.

The lawyer does not see that there is a request for a result: “Why are we doing this? We pretend (pretend not) and say to the IMF and the EU: “Look at the measures we are taking. We are concerned about reducing the VAT gap.” Damn! We don’t care about that.”