Romanian Senate approves tax exemption on reinvested profit

The Romanian Senate approved on Wednesday an amendment to the Fiscal Code that would exempt companies from paying taxes on reinvested profit. The change was pushed by the Conservative Party – PC, a junior member of the governing coalition, and passed with 48 votes in favor, 22 against and 2 abstentions.

The legislation did not attract enough supported in a first round of voting, but a Social Democratic (opposition) senator obtained a repeat of the vote after enough fellow parliamentarians were present for the procedure to be validated.

The provision allows all economic agents to reinvest any percentage of their profit without having to pay any profit tax. But a representative of the Government said the Ministry of Finance would not abandon its plans to force a 16% tax on reinvested profit.