Impact of VAT cut to 9 pc: Retailers – results to be higher than expected. Tourism operators – holiday costs will drop by 10 pc
The VAT cuts for food, soft drinks and food services from 24% to 9%, from June 1 will be found entirely in prices on the shelves, says the Association of Big Commercial Networks in Romania (AMRCR).
However, AMRCR hopes that lower VAT will be applied as soon as possible for other products as well and states that the Government will have positive results, much higher than estimated by analysts.
“AMRCR believes that the VAT cut must reach into the consumer’s pocket and the association members have expressed willingness to transfer this cut into the final price of products. Therefore, it will decrease according to the reduced quota,” said Dan Sucu, AMRCR president.
“We rely also on the government’s promise to cut the VAT to 20% for other products, so that customers who want to buy shoes, clothing, sanitary issues or quality furniture at affordable prices can take advantage,” Dan Sucu said.
The AMRCR members state also they will try to work with priority to those producers who understood the importance of such measures for the final consumer and show that those who do not want to act according to the lower VAT rate will exclude themselves from the market.
ANT: Tourism operators, optimistic will compete with Bulgaria
Romanian and foreign tourists spending their holidays in Romania this summer will pay out 10% less on accommodation and meals after the VAT cuts on food will be reduced to 9% in June, dubbed by the reduced duty on travel packages, from January 1, according to ANT.
“Holidays’ costs will fall by at least 10% for the summer holidays and I mean not only the package with breakfast, but also to what the tourist spends on food and accommodation in the resort,” said Mirela Matichescu, Vice President of the National Authority for Tourism (ANT).
She said that the decrease is due to the cut of VAT on food from 24% to 9% starting in June and due to the VAT decrease, also at 9%, on travel packages, applied early this year.
“By benefitting of these cuts, we hope to enter into real competition with our competitors, particularly with Bulgaria. Disciplinary measures adopted lately, accompanied by tax incentives, will be beneficial for Romanian tourism. Operators will be motivated to work legally and register everything with the cash register,” said the ANT official.