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Legislative summary – May 2019

In this issue:

·        The 5% VAT Rate

·        Recommendations of the Ministry of Environment regarding the application of GEO no. 74/2018

·        New provisions for registration in the National Register of the Manufacturers of Electrical and Electronic Equipment

·        Personal income tax and social security charges

 

·        The 5% VAT Rate

The Emergency Ordinance 31/14 May 2019 introduces the 5% reduced VAT rate starting 1 June 2019 for supplies of food of high quality value, namely mountain products, bio and traditional, authorized by the Ministry of Agriculture and Rural Development.

For more details, you can consult the Tax Alert no. 17 of 30 May 2019 and Official gazette noumber 403 / 23 Mai 2019.

 

·        Recommendations of the Ministry of Environment regarding the application of GEO no. 74/2018

Among the main provisions we mention:

-        the implementation of distinct tariffs/fees, by applying a lower tariff for recyclable waste compared to the tariff for other types of waste;

-        penalties for citizens who do not correctly collect waste: fees of 2-3 times higher than those set for proper collection;

-        the sanitation operator will have the right to reframe the recyclable waste or bio-waste, into residual waste and apply the tariff in question, in conjunction with the sanction mentioned above, if there is a degree of impurity higher than 25% for recyclable waste, respectively 10% for biodegradable waste.

For more details, you can consult the Tax Alert no. 15 of 9 May 2019.

 

·     New provisions for registration in the National Register of the Manufacturers of Electrical and Electronic Equipment

The Order provides several changes regarding the registration in the National Register of Producers of Electrical and Electronic Equipment ("EEE Register"). Thus, producers of EEE already registered in the EEE Register have the following obligations:

-         to submit to the National Agency for Environmental Protection ("NAEP") by October 2019, estimated general information for 2019 (quantities of EEE produced/ purchased/ exported);

-         to register online on the NAEP website.

For more details, you can consult the Tax Alert no. 18 of 3 June 2019.

 

·        Personal income tax and social security charges

·        Granting tax incentives related to the tax decisions issued be the Romanian tax authorities regarding the individuals’ health fund contribution for the period 2014-2017

·        Emergency Ordinance no. 31/2019 regarding the granting of tax incentives and amending and completing the Law no. 227/ 2015 regarding the Fiscal Code, for completing the Government Emergency Ordinance no. 11/ 2018 for adopting some budgetary measures and amending the Framework Law no. 153/2017 on the remuneration of staff paid from public funds

The Emergency Ordinance No. 31/2019, refers, amongst other, to the following aspects.

 

For the reconciliation of the health fund contribution related to the period 2014-2017, the following are provided:

-        In case of tax decisions issued and communicated by the tax authorities between 15 March 2019 inclusively and the date the Emergency Ordinance enters into force (14 May 2019), the payment deadline is 120 days computed as of 14 May 2019. A 10% bonification is applied if the liabilities are fully paid within 60 days since the present Emergency Ordinance enters into force.

-        In case of tax decisions issued and communicated by the tax authorities after the date the Emergency Ordinance enters into force, the payment deadline is 120 days since the tax decision is communicated. A 10% bonification is applied if the liabilities are fully paid within 60 days since the decision is communicated.

The payment obligation for the health fund contribution is cancelled, as well as any related late payment charges established by the tax decision issued to individuals for whom the computation base for the health fund contribution was rounded to the minimum national gross  salary or, where applicable, to the value of twelve minimum gross salaries, for the periods between 1 July 2015 and 31 December 2017.

If the tax authorities have not issued a tax decision for the the obligations relating to tax periods between 1 July 2015 and 31 December 2017, no tax decision will be issued furtheron.

For applying the above, The National Fiscal Administration Agency shall issue a procedure within 30 days since the present Emergency Ordinance Enters into force.

For more details, you can consult the Official Gazette no. 403 / 23 Mai 2019

 

For additional information, please contact:

 

Laura Ciobanu – Manager, Indirect Tax
Daniela Neagoe - Senior Manager, Indirect Tax
Costin Manta – Senior Manager, Indirect Taxes
Stela Andrei – Director, People Advisory Services
 
Alex Milcev, Partner – Head of Tax&Legal

 

Ernst & Young SRL

Bucharest Tower Center Building,

22nd Floor, 15-17 Ion Mihalache Blvd.,

Sector 1, 011171, Bucharest, Romania

Tel: (40-21) 402 4000, Fax: (40-21) 310 7124

Email: office@ro.ey.com

 

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