21% VAT, dividend tax 16% and solidarity tax

The representatives of the main political parties – PSD, PNL, USR and UDMR – continued on Tuesday, at the Cotroceni Palace, the negotiations on the fiscal reform necessary to reduce the budget deficit of Romania. The discussions focused on increasing several taxes, cuts of institutional expenses and restructuring, but it was not reached a final agreement, and the negotiations will continue in the coming days.

Profit.ro writes that among the analyzed fiscal measures are:

• Increasing dividend tax from 10% to 16%
• Increasing profit tax from 16% to 19%
• Increase of standard VAT rate from 19% to 21%with the possibility of reducing to 5% of VAT for food and medicines, as a compensatory measure requested by PSD
• Applying the general VAT rate for the Horeca sectorreplacing the current reduced quota
• Introduction of a 16% solidarity tax for net income exceeding 10,000 lei/month
• The application of a 2% tax on the value of the transactions considered « income outsourcing »in the context of transfer prices
• Progressive tax with application from January 2026
• Increasing the tax on cryptocurrency earningsfrom 10% to a possible 16%

At the same time, the parties also analyzed proposals related to privatization or listing of some state -owned companiesincluding Hidroelectrica, Nuclearelectrica, Salrom and Port Constanța. Some political leaders claim that the partial sale of these assets could generate significant revenues for the state budget.

In parallel with fiscal measures, the governors also discussed a series of discounts of public spendingincluding:

• Reducing bonuses for harmful conditions and working with European funds
• Limiting the value of holiday vouchers and food norm for public system employees
• Dismissal of up to 10% of public institutions staff
• Reducing institutions budgets by 5%
• Elimination of the 13th salary and capping of Christmas and Easter premiums for 300 lei In state -owned companies and agencies
• Limiting vocational training at online courses or institution’s headquarters eliminating expensive trips

Also, local authorities could be obliged to reduce the staff by up to 20%, depending on the number of inhabitants.

These measures come in the context in which Romania must reduce the budget deficit from 9.3% of GDP in 2024 (according to ESA Methodology) to 7% in 2025, in order to fall into the milestones assumed by the National Plan for Redress and Resility (PNRR) and in the Medium -Aurized Fiscal Program with the European Commission.

The specialists of the four parties will continue the negotiations during the week. Wednesday are scheduled discussions on Possible joys of institutionsand on Thursday one would be discussed Package of economic incentivesmeant to mitigate the social impact of the proposed fiscal measures.