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Romania’s Prime Minister Calls for an End to Tax Exemptions in the IT Sector

Publication date: 08/08/2023 00:45

Foto: Getty Images

Prime Minister Marcel Ciolacu declared, on Monday evening, on the show “Gândurile lui Cristoiu”, that Romania no longer allows tax exemptions such as the one from the CASS payment applied to employees in the IT sector. He says that it was needed but now we need “fiscal equity”. The PSD leader argues in favor of the fiscal measure that the Coalition is discussing: “you have billions of euros coming from the EU for all digitization areas in Romania, exactly what you deal with. Do you want us to risk losing these billions and not have what are you doing, or should we sit down at the table and understand that Romania can no longer afford what it could afford a few months ago?”.

“Today, together with Nicolae Ciucă and the other leaders, we closed 99% of the measures related to the administrative reform and certain tax increases”, said Marcel Ciolacu.

The Prime Minister stated that “the single tax was not bad”. “The mistake was when we abolished it. Some defend it, but it no longer exists. The single tax is when you have 16% VAT, profit tax, etc. The idea was not bad, but meanwhile the other economies have evolved, there is no longer a single quota in the EU”, he added.

The PSD president says that there will also be a reform of tax collection at the state.

“After the digitization of ANAF, progressive taxation will come. But I cannot come with new taxes now, the economic climate is still fragile, the fact that you come with so many direct investments, the context with the war on the border, you are not allowed with new taxes that discourage the economy”, he also claims to Aleph News.

Ciolacu says that there will not be a total elimination of exceptions.

“It will be an exceptional elimination at CASS. For example, ITs are exempt from income tax for 20 years. She was needed. It was a measure of a state that assumed it. I’m not saying it’s over, but tax equity is needed. That’s what the Commission says too. You cannot come up with social equity without also having fiscal equity. That’s what the Commission says too. You cannot invent other exceptions for each category.

Now I have a different reality. We left 2019 with 800 million lei in medical leave, we brought in another 750 million lei during the pandemic, so not something catastrophic. The problem is that I woke up in 2023 with 6 billion lei of medical leave. How every financier looks, the budget commissioner and I look like a serious man if I keep the CASS exemptions. Builders currently have this exception. They will pay CASS. They have the minimum wage per economy in construction of 4,000 lei. We will come with an increase to 4,500 – 4,600. Even if the man retains this CASS, he will not lose a single lei in income.

The commission says “we understand that you cannot give up everything at once, but at least the exceptions you have should be uniform in all categories”.

There are billions of euros in IT from EU funds. Nobody cuts until we talk again with the whole industry. Gentlemen, you have billions of euros coming from the EU for all digitization areas in Romania, exactly what are you dealing with. Do you want us to risk losing these billions and have nothing to do, or sit down at the table and understand that Romania can no longer afford what it could afford a few months ago? There is no loss of labor, because it will be paid the same. It is not a very clear ruling. The recommendation was that linear should be available to everyone,” said Prime Minister Ciolacu.

Editor: Alexandru Costea

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2023-08-07 21:45:29
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