2023-10-27 16:14:00
The new taxes that the Ciolacu Government assumed responsibility for and that Klaus Iohannis promulgated on Thursday appeared in the Official Gazette under the name of Law 296/2023.
tollFoto: Mellimage | Dreamstime.com
The name of this law will be remembered by taxation experts, just as happened with GEO 114/2018 or OG 16/2022.
Some measures apply from November and others from 1 January 2024.
In short, new taxes are introduced and some existing ones are increased. Also, some facilities are being restricted, specifically in IT, construction, agriculture and the food industry.
Big companies will be taxed at 1% on turnover if profits are “too low”
Large companies (with a turnover of over 50 million euros) will pay a tax of 1% on the turnover if the one on the profit (of 16%) is lower.
In practice, a formula is introduced from which various things are deducted, such as investments or excise taxes.
Exempted are companies that exclusively carry out activities of distribution/supply/transport of electricity and natural gas and which are regulated/licensed by the National Energy Regulatory Authority.
It applies from January 1.
Banks will pay an additional 2% tax on turnover
In the case of banks, an additional tax is introduced (in addition to the profit tax) of:
- 2%, for the period January 1, 2024 – December 31, 2025 inclusive;
- 1%, starting from January 1, 2026.
It applies from January 1.
Additional tax for companies in the oil and natural gas sectors
An additional tax of 0.5% is also introduced for oil and gas companies with a turnover of over 50 million euros.
Practically, in addition to the profit tax, this new tax should also be applied.
It applies from January 1.
New tax on small companies
The taxation of micro-enterprises is changed. Thus, there will be the following tax rates.
- 1%, for micro-enterprises that achieve revenues that do not exceed 60,000 euros
- 3%, for micro-enterprises that:
1. earns more than 60,000 euros; or
2. carry out main or secondary activities in various CAEN codes
It applies from January 1.
IT professionals will pay income tax for what exceeds 10,000 lei, and those in construction, agriculture and the food industry will pay CASS
Exceptions in IT, construction, agriculture and the food industry are reduced.
Those in IT will pay income tax for the amount that exceeds 10,000 lei. Also, they will be exempt from paying the contribution to Pillar II of pensions, in the sense that they can opt for it.
In the construction, agriculture and food industry sectors, employees will pay the health contribution (CASS) as they receive services anyway.
It applies from November 1.
Meal vouchers, charged additionally
Meal vouchers have a new feature: health contribution (CASS) will be paid for them.
It applies from January 1.
PFA-independent activities: ceiling of 60 minimum health wages
Authorized natural persons (PFA) and in general those who are self-employed will have a ceiling of 60 minimum salaries at CASS.
Basically, they will pay 10% on any amount up to 60 wages. Those with very high incomes are at an advantage.
It applies from January 1.
On which goods and services does VAT increase?
Increases VAT from 9% to 19% for the supply of alcohol-free beer and food with added sugar, the total sugar content of which is at least 10g/100g product.
It increases from 5% to 9% for:
- the delivery of social housing
- the delivery of homes that have a useful surface of a maximum of 120 sqm, exclusive of the outbuildings, the value of which, including the land on which they are built, does not exceed the amount of 600,000 lei
- delivery and installation of photovoltaic panels, solar thermal panels, heat pumps and other high-efficiency heating systems
- services consisting of providing access to amusement parks, amusement parks and recreational parks, fairs, exhibitions, cinemas and cultural events, other than tax-exempt
- the delivery of high-quality food, namely mountain, eco, traditional products, authorized by the Ministry of Agriculture and Rural Development. The delivery of these foods will be accompanied by a copy of the recognition/attestation/certification document issued by the competent authority, except for delivery to the final consumer.
VAT increases from 5% to 19% for:
The 5% share remains for:
- services consisting of allowing access to castles, museums, memorial houses, historical monuments, architectural and archaeological monuments, zoological and botanical gardens;
- delivery to natural persons of firewood, in the form of trunks, stumps, twigs, branches or in similar forms
- delivery to legal persons or other entities, regardless of their legal form of organization, including schools, hospitals, medical dispensaries and social assistance units, of firewood
It applies from 1 January 2024.
Excise duty on sugary drinks appears
A sugar tax is introduced. More precisely, it is an excise tax for:
- non-alcoholic drinks with added sugar for which the total sugar level is between 5g – 8g/100ml of 40 lei/hl
- non-alcoholic beverages with added sugar for which the total sugar level is over 8 g/100 ml of 60 lei/hl
Added sugar means cane sugar, brown sugar, crystalline sucrose, invert sugar, dextrose, molasses, honey sugars, molasses and syrups such as malt syrup, fruit syrup, rice malt syrup, corn syrup , high fructose corn syrup, maple syrup, glucose syrup, glucose-fructose, fructose, sucrose, glucose, lactose, hydrolyzed lactose and galactose added as ingredients, sugars in nectars such as coconut flower nectar, nectar of dates, agave nectar, sugars from unsweetened fruit juices, fruit juice concentrate, sugars from fruit purees and jam.
Special tax on expensive goods: houses and cars
A special tax appears for houses and cars.
It will apply to:
- natural persons who, on December 31 of the previous fiscal year, own/jointly own residential buildings located in Romania, if the taxable value of the building, calculated, exceeds 2.5 million lei.
- natural persons and legal persons who own cars registered/registered in Romania whose individual purchase value exceeds 375,000 lei. The tax is due for a period of 5 years starting from the fiscal year in which the handover-acceptance of the car takes place or for the fraction of years remaining until the completion of the 5-year period from this date for those in which the handover-acceptance of the car took place previously .
In the case of properties representing residential buildings, a rate of 0.3% will be applied on the difference between the taxable value of the building communicated by the local fiscal body through the taxation decision and the ceiling of 2.5 million lei;
In the case of cars, a rate of 0.3% will be applied on the difference between the purchase value and the ceiling of 375,000 lei.
The gas transportation concession fee increases 25 times
The royalty paid for the gas transport concession is increased 25 times, from 0.4% to 10%.
Unidentified income tax rises from 16% to 70%
People who cannot justify the assets they have will pay a tax of 70%, instead of the current 16%.
Through the tax decision, ANAF will establish the amount of the tax and the accessories.
e-Invoice from 2024
Companies have the obligation between January 1, 2024 and June 30, 2024 to send the invoices issued in the national RO e-Invoice electronic invoice system, regardless of whether or not the recipients are registered in the RO eInvoice Register.
The deadline for submitting invoices in the RO e-Invoice national electronic invoice system is 5 working days from the date of invoice issuance, but no later than 5 working days from the deadline for issuing the invoice.
Failure to comply with the provisions constitutes a misdemeanor and is sanctioned with a fine from 5,000 lei to 10,000 lei for legal entities classified as large taxpayers, with a fine from 2,500 lei to 5,000 lei for legal entities classified as medium taxpayers, and with a fine from 1,000 lei at 2,500 lei, for other legal entities, as well as for natural persons.
By way of exception, non-compliance with the provisions between January 1 and March 31, 2024 is not sanctioned.
Cash payments will be reduced
Collections made by cash and carry stores (Metro, Selgros, etc.) are capped within a daily limit of 2,000 lei per person.
Likewise, cash and carry stores to individuals will also be similarly capped (daily ceiling of 1,000 lei/person, but no more than a total ceiling of 2,000 lei/day).
Payments granted as advances for settlement are to be capped at 1,000 lei, a ceiling established for each person who received advances for settlement.
Fragmented cash receipts from beneficiaries for invoices whose value is greater than 1,000 lei and 2,000 lei, respectively, in the case of cash and carry stores, as well as fragmenting invoices for a delivery of goods or a service are prohibited. services whose value is greater than 1,000 lei, respectively 2,000 lei.
It applies within 15 days of publication in the Monitor, i.e. from mid-November.
Companies will no longer be able to be dissolved if they have debts to the state
The list of companies for which the National Office of the Trade Register is going to formulate dissolution actions should be displayed in the electronic Bulletin of the trade register, at least 60 calendar days before and sent to the National Tax Administration Agency.
Within 45 calendar days from the date of display/receipt of the list, the National Fiscal Administration Agency, as well as any other creditor, communicates to the National Office of the Trade Register, the companies that register outstanding budgetary obligations and/or for which a tax control action, or other unpaid claims, in which case the initiation of the dissolution action is postponed, until they are extinguished, as the case may be, respectively until the completion of the fiscal control action.
Same with erasure.
Measures to reduce budget expenses
- The total number of approved public dignified positions related to the positions of secretary of state, state adviser, undersecretary of state, vice president and their equivalent positions shall be reduced by at least 25% by January 1, 2024.
Vacancies, from the states of approved functions, except for those within the territorial administrative units and their subdivisions, are abolished.
*The establishment of new positions for institutions can be approved, only starting from July 1, 2024 only in cases thoroughly justified by a memorandum approved by the Romanian Government or as the case may be at the local level only with the approval of the local public administration authorities by decision of the local/county councils .
- Office head positions are abolished.
- The personnel employed in the public position of head of office benefit from all legal rights upon release from public office, including by occupying, under the law, a hierarchically superior public management position.
- With the abolition of the public position of head of office, the organizational structures that function as offices are also abolished.
- The organizational structure of public authorities and institutions must comply with the following requirements:
to set up a service, a minimum number of 10 execution stations is required;
for the establishment of a department, a minimum number of 20 execution positions is required;
for the establishment of a general direction, a minimum number of 35 execution positions is required.
- The total number of public management positions within the public authority or institution, with the exception of the public positions of general secretary of the administrative-territorial unit/subdivision, as well as public management positions which are filled by secondment with staff from institutions in the sector of defence, public order and national security, according to the approved organizational states, under the law, is a maximum of 8% of the total number of approved positions at the level of principal credit officer.
- Starting from October 1, 2023, the loan officers obligatorily grant, on a monthly basis, for employees whose net monthly salaries are up to 8,000 lei, including food allowances at the annual level of two minimum wages per economy in force on January 1, 2019, updated annually with the consumer price index, with the following exception:
- the staff of the Ministry of National Defense, the Ministry of Internal Affairs, the Ministry of Justice, the National Administration of Penitentiaries, the Romanian Intelligence Service, the Foreign Intelligence Service, the Protection and Guard Service and the Special Telecommunications Service, the National Administration of State Reserves and Special Issues as well as local police personnel.
- In relation to the working conditions in which the activity is carried out, dangerous or harmful conditions, salaried staff can receive an increase of up to 15% of the basic salary but not more than 1,500 lei gross monthly, corresponding to the time worked at the respective jobs , in compliance with the legal provisions in force.
- The purchase of mobile phones in public entities cannot exceed the maximum amount of 500 lei exclusive of VAT/mobile phone purchased.
- The monthly expenses with the mobile phone subscription settled from public funds are a maximum of 35 lei exclusive of VAT/month/mobile phone device.
- The number of advisers in the cabinets of the presidents of the boards of directors, presidents, vice-presidents, general directors, deputy general directors, as well as in other cabinets of leaders at the level of economic operators is reduced by 50% of the number of approved positions.
- The board of directors will consist of 5-7 members in the case of public enterprises that meet the following cumulative conditions:
– they registered a turnover in the last financial year higher than the equivalent in lei of the sum of 7.3 million euros;
– have at least 50 employees
- The number of members of the supervisory boards/specialist committees as well as of other committees organized alongside the boards of directors or other management bodies regardless of their nature, their name and the way of organization cannot be more than 5 people.
- Societies, national companies and national companies with full or majority state capital, as well as autonomous companies active in the field of electricity, natural gas and oil, can purchase passenger cars with a cylinder capacity of no more than 1,600 cm^3, the price of which can exceeds the counter value in lei of 23,000 euros including VAT, but not more than 30,000 euros including VAT
- Spending on holiday vouchers cannot exceed the value of 1,600 lei/year/person annually, between January 1, 2024 and December 31, 2026.
- The limitation on phones and subscriptions will also apply to state-owned companies.
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