Govt endorsed draft law on amending Fiscal Code

The Romanian government endorsed the draft law regarding the Fiscal Code amendments on Wednesday. The law is to be taken to the Parliament for debate and approval so that it enters into force on January 1, 2007, acording to the Finance minister Sebastian Vladescu’s timetable.

The draft law brings some amendments regarding the legal framework which takes after EU directives, the taxing basis, and it generalizes the flat tax of 16%. The law maintains the flat tax to 16% and the VAT to 19%.

The amendments sparked some criticism from the opposition Conservative and the Social Democratic parties. The Conservatives (PC) are dissatisfied with the fact that their proposals regarding the tax abolishment on reinvested profit, reducing the Vat for food products to 9% and taxing of small enterprises.

PC also pleads for the keeping of the current tax system regarding the SEs which gives the possibility to choose from 3% of the turnover or 16% of the profit.

The Liberal senator Varujan Vosganian said for Hotnews that time pressure is another problem. It takes at least five weeks for the draft law to pass all commissions and July 1 is the deadline for its endorsement by the Parliament.