Romanian Parl Commissions Vote To Eliminate Min Tax, Cut Building Construction VAT To 5%

Publish date: 11-01-2010
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The Romanian Parliament commissions for budget and finance adopted Sunday morning a series of amendments to the draft state budget, including ones that eliminated the minimum tax, applied a lower VAT to building construction and a 3% tax on micro-enterprise revenue.

The amendments were proposed by the Liberal Party, which also requested the penalty for delays in the payment of fiscal obligations be reduced from 0.1% per day to 0.03% per day. The request was rejected by the commissions, although they accepted a social democrat deputy's similar proposal, to reduce the penalty to 0.05% per day.

Finance Minister Sebastian Vladescu said that the Government had already proposed eliminating the minimum tax. He was of the opinion that certain amendments should not have been approved, while others, which were rejected, would have supported the business environment had they been accepted.

The commissions approved an amendment to allow the deductibility of VAT in the case of automobiles.

Finance Ministry state secretary Gheorghe Gherghina said eliminating the minimum tax would result in the budget earning 1 billion lei (EUR1= RON4.1679) less, the lower VAT applicable to building construction would cost the budget RON960 million and a further RON500 million would be lost because of deductible VAT in the case of cars.

One of the rejected amendments proposed a 5% discount for taxpayers who pay their contributions on time.

The amendments will be subject to vote in Parliament plenary meetings.

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