VAT for food drops to 5%

Romania Senate approved on Wednesday the decrease of VAT from 19 to 5% for basic food products, although the Government representatives participating in the session indicated that this would cause a budget loss of some 200 million RON (some 55 million euro). The funds to cover the loss, it was decided, will come from a 50% growth of taxes and excises for personal yachts, planes and helicopters, as well as a new growth of the tobacco taxes.

The decision was approved with 44 votes in favor, 16 against and 16 abstentions.

The VAT will decrease for bread, milk, oil and sugar.