The Romanian Government is urged by numerous organizations representing American, French, German, and Romanian investors to maintain the single tax system to foster economic growth.
According to Lobby Romania, some of the major organizations in the business environment in Romania reacted when Social Democratic Party demanded that the Government rethink its budgetary policy and give up the single quota. The organizations are considering the single tax rate essential for economic growth.
The organization of foreign investors recommended boosting tax collection, thwarting tax evasion with stricter controls and fines if issues are found, and reexamining Romania’s legal structure for microenterprises and PFAs.
As long as they are used in good faith, in a truly entrepreneurial manner, and not to conceal employment arrangements, these are advantageous and acceptable forms of organization.Foreign Investors Council, press release
The financial recommendations of the foreign investors in Romania
- Maintaining a single tax rate – a simple and essential tax system for economic growth, which has brought prosperity, created jobs, encouraged the formation of a middle class in Romania and is also one of the main competitive advantages of Romania.
- The real reduction of tax evasion, including the VAT collection deficit, as well as the reduction of state expenditures. Digitization remains a fundamental tool for achieving this goal
- Increasing tax collection and combating tax evasion through tougher sanctions and controls in areas where they are identified
- Reassessing the framework in which micro-enterprises are used in Romania. These are beneficial and welcome forms of organization as long as they have a well-defined purpose by law and are used in good faith, in a truly entrepreneurial manner, not to mask forms of
- Restoring the financial system so as to stimulate work, bring black and gray work to the surface, reduce the exodus of employees and bring Romanians from abroad home. This goal can be achieved by capping social health and pension contributions at a reasonable number of average wages per
- Identifying the key sectors that the government wants to stimulate, taking into account Romania’s interests and the medium and long-term perspective. Stimulating the export of high-value-added goods and services can help reduce the trade deficit.
Other suggestions include identifying the key industries that the Government wants to support while taking into account Romania’s interests and the medium- and long-term outlook. Shifting the tax structure to encourage employment, bringing underutilized labour to the fore, reducing employee departure, and bringing Romanians living abroad home, were other suggestions for boosting the export of high value-added goods and services that help reduce the trade deficit.
However, given the current economic situation, any changes to public policies must be made only after open communication with all parties. The business sector also confirms its openness and desire to interact with the Government to lay the foundation for a long-term, transparent, digital, and predictable tax system.