Romania Cannot Eliminate Its Car Tax

Bogdan Olteanu, chairman of the Chamber of Deputies, said Romania cannot accept the European Commission's request to eliminate its car tax, since Romania and the Commission do not share the same interests in this respect.

If Romania were to eliminate its car tax, then, half the people working in the car industry would lose their jobs, stressed Olteanu.

Olteanu pointed out that seventeen EU states have their own car tax regimes and Hungary's car tax is a lot higher than Romania's.

Romania's environment minister Korodi Attila Friday said that the government will set the final value of the car tax in accordance with the three new requirements forwarded by the Commission, which, however, will not fundamentally change the value proposed by the Romanian experts.

According to Korodi, the Commission asked Romania to levy a higher tax for cars with weak Euro catalysts, to lower the tax in direct ratio with the car age within the same Euro group and to render the car tax challenge procedure clearer.

The Romanian officials on Wednesday met with the representatives of the Directorate-General for Taxation and Customs Union within the European Commission for talks on the car tax.

Adrian Ciocanea, head of the Romanian Department for European Affairs, said Romania's proposals on future amendments to its much-disputed car tax "observe the European legislation in the field," stressing that the last details on the matter will be dealt with next week so that the ordinance amending the legislation in the field can be issued by January 31, 2008.

The tax was introduced early last year, when the elimination of excises for imported vehicles thinned the state budget. The tax was immediately frowned upon by the EU, which considered it discriminating against second-hand EU imported cars. The first registration tax, as it was called, was calculated depending on engine capacity, car age and level of emissions.

Mediafax