Although the fiscal programme proposed by the Government was adopted by Parliament as early as four months ago, the controversies over its impact on the budget and on the business environment have not died out. The most vehement institution that does not agree with Romania’s new fiscal policy is the Fiscal Council. The paradox in which this institution finds itself in relation to the Romanian Government is that although it is made up of five members, all of the Council’s public positions are delivered by its President, as if the Fiscal Council was a military organization where only the one in charge can express himself. Nevertheless, it is worth pointing out that the number of those seeing the fiscal programme as a glass half-full has grown.
The favourable attitude with most resonance is that of PricewaterhouseCoopers Tax Advisors & Accountants (“PwC”), the world’s biggest professional services, consultancy and audit company.
Yesterday, PwC Romania publicly expressed its point of view on the fiscal programme.
“The new Fiscal Code and Fiscal Procedure Code, through the legislative clarification and fiscal policy predictability elements that they introduce, represent an advantage for the Romanian business environment,” a communiqué reads. PwC representatives present the 10 most important fiscal topics that will significantly influence the business environment and will leave a mark on the Romanian economy’s evolution in the following period.
Among them, the reconsideration of the way groups of companies organize and manage the cash flow at shareholders’ level through the introduction of the lowered 5 per cent dividend tax starting on 1 January 2016; the improvement of the cash flow and the stimulation of consumption through the reduction, simplification and diversification of the VAT levels and, at the same time, the lowering of costs and of the administrative burden through the elimination of non-harmonized excises; attracting in Romania an ever increasing number of holding companies by considering foreign companies taxed in Romania if the actual management of these companies is located in Romania (correlated with the lowering of the dividend tax); lowering the period of time in which companies can benefit from the recovery of VAT in the case of insolvent clients.
“Against the backdrop of an international climate that is continuously changing from a fiscal standpoint, the adoption of the new Fiscal Code and Fiscal Procedure Code puts Romania in a favourable situation. As we know, the consumers’ and companies’ expectations play an important role in the economy. Having the outlook of a gradual fiscal relaxation, Romania has become more attractive for investors,” said Mihaela Mitroi (photo), Leader of PwC Romania’s Fiscal and Legal Consultancy Department.
“We are facing a new beginning from a fiscal standpoint, however fiscal measures alone are not enough to sustainably put Romania back on a growth trend. There will also be a need to continue structural reforms and to accelerate investment in infrastructure in order to be able to build the high-performing economy we all want,” Mihaela Mitroi concluded.