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June 30, 2022

PM Ponta: A Fiscal Code with a 20pct VAT will clear Parliament; it is good and sustainable

Prime Minister Victor Ponta on Tuesday evening said that a Fiscal Code with the current provisions and a 20-per-cent Value Added Tax (VAT) will clear Parliament and will be very good and sustainable.
“I have also seen the position of some serious parties in the Opposition, which don’t walk back on their vote, which said they wanted 19 per cent [VAT]. I told the ruling coalition leaders that it would be best to have 20 per cent, as the initial draft stipulated, because together with the 9 per cent for foodstuffs, the VAT average in Romania stands somewhere at 17 per cent. But then, the PNL [National Liberal Party] has made a populist move, typical of the new PNL. They said: ‘Well, 19, not 20, let’s give 1 per cent more, so we can vote.’ I said: ‘All right, ok,’ this populism costs us, but the important thing is that we have consensus. Therefore, I believe a new Tax Code with the current provisions and a 20-per-cent VAT will clear Parliament, it will be very good and it is sustainable,” Victor Ponta told Romania TV private television broadcaster.
He pointed out that he hasn’t discussed the matter with President Klaus Iohannis, but that they will approach this topic and also other topics related to institutional collaboration.
When asked if President Iohannis will raise a sustainability question over the increase in the medical staff’s salaries, as he did in the Tax Code case, the prime minister said jokingly that he wants the head of state to raise the same sustainability question as in the case of child allowances having been doubled.
“I told him we still haven’t got the budgetary impact and he still promulgated it. (…) In the current case, we have the budgetary impact and we also have the budget source, therefore I don’t see why he would not promulgate it, but I cannot speak on the President’s behalf. I can do my job, which is compulsory, namely that of calculating how much money this thing costs us, where we get the money from, and then, certainly, Parliament votes or not, it is Parliament’s decision. The President promulgates or rejects once – in the end, in the Forestry Code case the President also asked for re-examination. It cleared the vote and he promulgated it. It will be the same with the Tax Code,” added Ponta.

Alina Gorghiu: Liberals will not reject any measure when Fiscal Code is discussed

Co-chair of the National Liberal Party (PNL) Alina Gorghiu says PNL will not reject any measure when the Fiscal Code is discussed, adding that pay increases and tax relief are good ideas.
“We will not reject any measure when the Tax Code is discussed. The idea of tax relief is a good idea, and so is the idea of increasing pay in the public sector. What we have to discuss is phasing. These measures have to be correlated and a very consistent plan should be worked out for how much and when. While this may seem very easy, a long-term consensus and commitment are nevertheless needed because we have the experience with the teachers’ pay unanimously passed in Parliament but not applied to date,” Gorghiu told B1 TV private broadcaster.
She added that PNL has two working scenarios it will unveil at technical talks on the Tax Code.
“Catalin Predoiu will head the talks and, according to our reckoning and analysis, we will see what the Government’s position is; whether or not [Finance Minister] Teodorovici has changed his mind or brought more nuance, whether or not he is more flexible in talking to us. (…) The natural scenario I want (…) counting on the good faith of all colleagues in the parliamentary parties, is for us to agree on a solution on Thursday that will adjust tax relief measures, anticipate what to do with the pay package in the public sector and pledge to put a halt to the Government’s measures that reek of electioneering. That is the scenario I want, a scenario that is soundest for the Romanian society. There are other scenarios as well: [Prime Minister] Ponta pulling out of the Government, which he denies and on which I do not want to dwell. There is also a scenario of the Tax Code clearing Parliament as proposed by the PSD [Social Democratic Party] with the ballots of the coalition that backs up the Government in this extraordinary session. Between the responsible conduct of PNL today and the vote against a code that has no support and is unsustainable and losing some votes in the elections, I will choose the former. I will always play the card of responsibility,” said Gorghiu.
The PNL co-chair argued that the reported Government surplus was the outcome of public investment having been cut.
She added that if the Fiscal Code clears Parliament, “Ponta or whoever PSD member heads the Government will prorogate measures, because this package of tax relief cannot pass; it will not be included in the 2016 national budget.”

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