Radio România Internațional

Tag: excise

  • Fiscal Code Amendments

    Fiscal Code Amendments


    In times of crisis, taxes and charges should not be raised. This is a rule often mentioned by economic analysts and politicians.



    These days however, burdened by a two-digit inflation rate prompted by skyrocketing energy and natural gas prices, Romanians are finding it increasingly hard to cope. And they fear they will be unable to pay their bills this coming winter. Under these circumstances, additional taxes and charges only manage to bring people down even more.



    Asked recently about the amendments to the Fiscal Code that are taking effect on August 1, the president Klaus Iohannis said they do not introduce new taxes, but that they address situations that had not been properly regulated before. More precisely, this is about taxes introduced in other circumstances, perhaps without proper discussion or analysis, and it is now necessary to revisit them, to make things more transparent and fair, and thus to ensure better collection of state budget revenues. Better collection means less tax evasion, president Iohannis argued.



    That said, following the decisions made recently by the coalition government made up of the National Liberal Party, Social Democratic Party and the Democratic Union of Ethnic Hungarians in Romania, as of August 1 tobacco products will be more expensive, ceilings for certain tax exemptions will be lower and the tax on gambling gains will be higher.



    To go into more detail, as of Monday, whether they smoke classical or electronic cigarettes, Romanians will pay more, as the tobacco excise duty is raised. The decision, the authorities say, was made in order to avoid an infringement procedure against Romania for the inadequate transposition of EU legislation in this respect.



    The prices of alcoholic beverages also go up. According to the finance minister Adrian Câciu, the excise duties for alcohol had not been updated since 2015.



    As for gambling gains, a higher tax will be levied, ranging between 3% and 40%.



    Changes are also operated as regards salaries in the construction industry, agriculture and the food industry, where the ceiling for certain tax rebates will be lowered from EUR 6,000 to EUR 2,000 per month.



    Also beginning on August 1, for a part-time employment contract, employers will have to pay taxes corresponding to a full minimum salary, which triggers concerns that many small companies might be forced out of business or resort to illegal employment.



    Even more changes to the Fiscal Code will take effect on January 1, 2023. For example, in the hospitality industry VAT will be raised from 5 to 9%, while the VAT for non-alcoholic beer and for sugary drinks will be raised to 19%. Property taxes will also be calculated on a new methodology. (AMP)


  • Government-generated compensations for the fuel price

    Government-generated compensations for the fuel price




    The
    price of fuels has constantly increased as of late, in Romania. That sparked discontent among car drivers, who staged protests in petrol stations.
    Following a series of talks initiated in the government coalition, Prime
    Minister Ciuca on Thursday announced the pump fuel price would be compensated.
    Therefore, starting July 1st, for three months, the price per liter of
    fuel would be cheaper by 50 bani. The deduction applies for everybody, private
    entities or haulers. Also, the deduction will be separately printed on the cash
    receipt.

    Prime Minister Nicolae Ciuca:


    We have identified, jointly with the specialists, a
    fixed-sum 50-bani compensation solution, to be implemented straight at the gas
    pump. The mechanism by means of which we ensure the stability of the price is
    to be implemented for a three-month period. The compensation will be printed
    separately on each cash receipt issued by the petrol stations.


    The
    compensation will be endorsed by the government through an official document
    next week. According to Prime Minister Ciuca, the Government will come up with
    a mechanism supported by 2 billion lei worth of funding. 1 billion will be
    earmarked from the state budget, while the other billion will be provided by
    the companies in the oil sector. Prime Minister Ciuca went on to say that, when
    the three-month period ends, the opportunity will be examined, to adopt a new
    set of measures. The Prime Minister also stated the Government had a useful
    instrument at its fingertips, namely the government ordinance issued to stave
    off speculative effects. Prime Minister Ciuca was adamant in stating that through
    the set of measures a high-level consumer protection would be provided, against
    untenable price hikes.


    The
    other major party in the governing coalition, the Social-Democratic Party, has
    nonetheless favored price capping as the best solution. The Social Democrats have
    said they complied with the Prime Minister’s decision. However, they said,
    should the prices increase again, they would will reiterate, in the governing coalition,
    their proposal for a set top-up price level or for the reduction of the trade
    markup. The Save Romania Union, in opposition, criticized the Government’s decision.
    Instead, the Save Romania Union has pleaded for a consistent VAT drop for fuels,
    from 19 to 5%.


    In
    turn, President Klaus Iohannis stated the reduction of the fuel excise duty could
    not be implemented. President Iohannis went on to say direct capping or price
    subsidizing were not possible. President Klaus Iohannis also stated Prime Minister
    Ciuca assured him the sum required for the 50-bani compensation could be provided
    by the state budget. Klaus Iohannis also
    said that, ostensibly, the governments had the capacity to reduce the excise
    duty, yet that was not feasible, actually, because of the European legislation.
    President Iohannis went on to say it was easy to change the excise duty whenever an increase
    was implied, but the reduction of the excise duty, that was not possible below
    a certain level.


    (EN)

  • February 23, 2022

    February 23, 2022

    UKRAINE – Romanian Prime Minister Nicolae Ciuca has assured his fellow Romanians, in the context of the Ukrainian crisis, that all necessary institutional measures, in keeping with the decisions of the Higher Defence Council, have been taken. He has explained that these steps were taken in coordination with the NATO allies and the EU member states. PM Ciuca called on ministers with attributions in the field to keep monitoring the situation and work co-ordinately and carefully. In another development, the Senate and the Chamber of Deputies in Bucharest will convene in joint session on March 1st, to adopt a political declaration in support of Ukraine’s territorial integrity, sovereignty and independence. On Tuesday, Cristian Chirtes, chairman of the Joint Standing Committee of the Chamber of Deputies and the Senate for the exercise of parliamentary control over the activity of the Romanian Intelligence Service (SRI), said that Romania’s security situation from the perspective of the legal attributions of the Romanian Intelligence Service (SRI) is stable. He also said that, in the context of the Ukrainian crisis, cyber attacks on critical infrastructure, Romanian ministries and agencies, increased.



    SANCTIONS — The United States adopted on Tuesday what American President Joe Biden called a “first tranche” of sanctions, in response to the recognition by Russia of the separatist republics in Ukraine. “We cut off Russias government from Western finance”, Biden said, adding that sanctions also target Russian elites and their family members. The White House leader described the latest events as the beginning of the Russian invasion and announced that an American battalion and several F-35 fighter jets will be deployed this week in the Baltic region and Eastern Europe. He said, however, that he was moving additional troops and equipment to “strengthen” US allies in the Baltic nations on NATOs eastern flank, but made it clear they would not be there to “fight Russia.” The White House has announced that a Biden – Putin summit, a French initiative initially accepted in principle by the two leaders before Russia’s recognition of the separatist republics, was out of the question.



    DECISION – The Bucharest Government is going to pass, in today’s meeting, a decision on the organisation and functioning of the Committee on Monitoring the National Recovery and Resilience Plan (NRRP). The institution in charge with the implementation of reforms and the fulfilment of the objectives assumed under the NRRP is the Ministry of Investment and European Projects, which will monitor the implementation of reforms and investment stipulated in the NRRP with the support of NGOs, trade unions, employers’ associations and the structures of the local public administration.



    INFLATION – The annual inflation rate in the EU increased in January up to 5.6%, from 5.3% in December 2021, according to data made public by the Eurostat on Wednesday. The member state with the highest inflation rates are Lithuania (12.3%), Estonia (11%) and the Czech Republic (8.8%). As compared with the situation in December 2021, the annual inflation rate in the first month of 2022 went down in 8 member states and increased in 19 countries, Romania included, from 6.7% to 7.2%. Romania ranks 11th among the countries with the highest annual inflation rates. The countries with the smallest annual inflation rates are France (3.3%), Portugal (3.4%) and Sweden (3.9%).



    FUEL – The parties forming the ruling coalition in Bucharest have agreed to temporarily cut the fuel excise by 50%. The measure reduces by RON 1 the retail price of petrol and diesel, Finance Minister Adrian Caciu has said. The proposal was supported by the Social Democrats, while their leader, Marcel Ciolacu, said the solution is aimed at preventing prices from going up. In turn, Liberal leader Florin Citu has said that his party agrees, in principle, with any measure that reduces fiscal burden, but has added that, if the retail price of fuel does not go down, somebody will have to take responsibility. The National Liberal Party (PNL), the Social Democratic Party (PSD) and the Democratic Union of Ethnic Hungarians in Romania (UDMR) have also agreed to further subsidise electricity and natural gas bills in the month of April.



    CORONAVIRUS – Romania reported on Wednesday 11,477 new cases of Covid-19 and 119 related deaths, of which 9 from a previous date. Of those nearly 9,000 Covid patients treated in hospital, a little over 1,000 are in intensive care. In terms of vaccination, about 1,000 people had the first shot in 24 hours. The Omicron variant becomes quasi-dominant in Romania, with over 95% of the results indicating infection with this strain of the virus, Health Minister Alexandru Rafila said. In his opinion, in about three weeks the number of infections nation-wide could be small, with hundreds of new daily cases being expected instead of thousands as is the case now. Rafila also said a 6th wave of the pandemic is not to be expected. (EE)

  • Measures to lower fuel and energy prices

    Measures to lower fuel and energy prices


    The leaders of the ruling coalition have agreed on new measures to lower natural gas and electricity bills and to help slow down the rise in inflation seen early this year.



    A temporary 50% cut in the fuel excise is one of the measures prompted by the energy crunch. Data shows that in Romania, fuel costs account for 8% of the market basket, but for households with small and medium incomes the share may reach as much as 12%.



    With this measure validated on Tuesday by the ruling coalition comprising the Social Democratic Party, the National Liberal Party and the Democratic Union of Ethnic Hungarians in Romania, the retail price of petrol and diesel is set to drop by more than RON 1 from around RON 7 per litre at present.



    The measure was backed by the Social Democrats, whose leader Marcel Ciolacu says the move is designed to put a stop to price rises.



    Marcel Ciolacu: “Weve seen the rise in oil prices but we are hoping to balance this by cutting the excise. We are thinking about the problems Romanians struggle with and about ways to stop this surge in prices.”



    The Liberals agree in principle with lowering taxes, excises, contributions and anything that would help ease the fiscal burden, the Liberal leader Florin Cîţu said. He warned however that if retail prices fail to drop, someone must take responsibility.



    Florin Cîţu: “Well see the figures from the finance ministry. I feel these scenarios are optimistic. I hope these measures are not just for the sake of the governments image, because they would cost RON 3-4 billion.”



    By giving up half the petrol and diesel excise for the next 6 months, the government is giving up a share of budgetary revenues, while citizens and companies see their current costs reduced.



    Talks will be held in the forthcoming period with the European Commission and major fuel suppliers to keep fuel prices at a manageable level for all household and corporate consumers, the finance minister Adrian Câciu said.



    The ruling coalition also decided to introduce an emergency order in April, to offset and put a cap on electricity and natural gas bills. (A.M.P.)