ECONOMY FINANCE&BANKING

FinMin Teodorovici on the tax amnesty: Insolvent companies and those who have debts related to rents will not be included in this measure

The insolvent companies and people who have debts related to rents cannot be legally subject to an amnesty, Finance Minister Eugen Teodorovici stated on Thursday at a conference.

“The law provides certain categories that cannot be subject to an amnesty. We are in an incipient stage now, we’ll talk when we’ll have a very clear, coherent material, with several alternatives, we will publicly discuss about them” Eugen Teodorovici stated.

Asked if the tax amnesty will encourage nonpayment, since the targeted people know that they will be released from debts, the Finance Minister said it will not. “But nobody said it will be. It was a discussion at some point, this information circulated, but if they wish to wait for something that maybe will not come, it’s their choice, and they will pay for that” the Minister said.

Asked who will be subject to the tax amnesty, the Finance Minister mentioned that analyzes are being made on this issue. “There is an analysis, a discussion, but I haven’t said everybody will be included, only some of them, only the companies, only individuals, there are several elements” the Finance Minister said.

“Look at what happened in 2015, it was applied to both individuals and legal persons, and they paid them within a certain term, if I’m not wrong they were exempted from penalties and a part of the interests. I think this was the mechanism, but we shouldn’t forget those who comply voluntarily, ‘cause it’s fair to look also to those who pay fairly and on time their debts to the state, so we must find an element which is fair on the market” Eugen Teodorovici said.

PM Viorca Dancila’s State Counselor, Darius Valcov, announced at the beginning of this week that the tax amnesty is a measure provided in the governing program and includes the erasure of the debts of some companies, but he mentioned that “such things have to be done, not discussed”.

 

Capping gas prices, a communist practice up to a point, but necessary due to no competition

 

The Government’s intention of capping gas prices is a communist practice up to a point, but necessary, because on this market there is no competition, and companies raise prices as they please, said Thursday, Finance Minister Eugen Teodorovici, present at the White Book of SMEs launch conference.

He referred to the Government decision published Wednesday evening on the Ministry of Public Finance’s website, according to which the internal production gas price will be capped to 55 lei per MWh until June 30 2021.

“Some say it is a communist practice. Yes, maybe at a first glance it might seem that way, because you are trying to enter the market, and yes, it is that way, but up to a point. We are talking about competition. What competition? There are two operators that raise prices, one by one, and the other one aligns immediately. Assumed investment have not been made, and yet the price rises without any justification, and you and the economy have to suffer for it. Some rush into it right away, as if from another country, because it is a communist practice. I had no connection with communism,” said Teodorovici.

The explanatory memorandum of the Government draft decision initiated by the Ministry of Public Finance shows that this measure is necessary in order to stop the uncontrollable gas price hikes.

According to the initiators, the project has a positive impact through stopping the uncontrollable natural gas price hikes from the internal production, generated by the dominant position of the two major producers that have a market quota, of over 46 percent each and 95 percent together (Romgaz, with a quota of 48.88 percent and OMV Petron – 46.08 percent of the total production).

Starting with April 1st 2017 the selling price of natural gases from the internal production was liberalized, setting itself within the competition market through freely negotiated contracts with suppliers and final clients on the basis of supply and demand.

On the natural gas market there is currently an operator of the National Transport System – Transgaz S.A, 7 producers (Romgaz, OMV Petrom, Amromco Energy, Raffles Energy, Foraj Sonde, Stratum Energy and HUNT OIL Company), 5 foreign suppliers which bring natural gas from outside sources into Romania (Engie Energy Management, Imex Oil, MET International AG, Alpiq Energy SE and Wiee AG Switzerland), 2 operators for storage (Romgaz and Depomures), 36 distribution operators (the largest ones being Distrigaz Sud Retele and E.ON Gaz Distribution), 87 active suppliers present on the market and 3 operators of the centralized markets. On the natural gas market there are approximately 3.7 million final clients, of which 3.4 million are covered residential customers.

 

FinMin Teodorovici asks US ambassador Klemm for visa waivers for business people

 

At a public event on Thursday, Romania’s Finance Minister Eugen Teodorovici asked the US ambassador in Bucharest Hans Klemm to suggest to the US officials lifting visa requirements for Romanians nationals on business travels.

“I have a request to the ambassador: I would ask him, if possible – I do not know how much it can be applied or promoted – but there is one thing I think would be very good to the business environment of Romania and to the entire Romania population, implicitly: a proposal to be made that the US lifts its visa requirements at least for Romanian business people travelling there. In tourism there is something else, I know, but I think it is the case for the business people to have a fair competitive environment on par with other countries in the European Union that do not have this impediment,” said Teodorovici  at the launch of the White Book on Romania’s SMEs Thursday.

He added that Romanian business people waste important time on obtaining a visa.

“On the other hand, Romania’s other neighbours in Europe get access to the US very easily and they may blow up our business opportunities. I think visas are a hindrance, and image-wise is still a hindrance. Things may be done on this segment, the business environment,” said Teodorovici.

Ambassador Klemm declined to answer the questions of journalists at the end of the event.

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