FinMin announces project of securing borders based on scanning all products entering Romania in attempt to counter smuggling

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Attending the event in Ploiesti that announced the strategic investment to be made by British American Tobacco (BAT) in Romania in the upcoming years, Romanian Finance Minister Eugen Teodorovici hailed the initiative and announced some major measures to be taken by the Government to counter the cigarette smuggling and to boost the labour market in Romania, while also launching some warnings.

First, the Finance minister has advised BAT that, besides the future products made in Romania, to also consider relocating part of its production technology in our country.

You must also think of what you could bring more. You should consider relocate as much as your technology needed to make such products in Romania and you will have the Romanian Government’s big support, through the state aid schemes, support for relocating activities and also support for the production and export,” FinMin Teodorovici said, adding that the Executive also wants to stimulate both production and export also outside European Union as much as possible.

However, he pointed out that the best balance on the law framework must be identified to favour the tobacco industry and the public health campaigns at the same time. “A lot of money must go on the public health campaign, to discourage smoking,” he argued.

Teodorovici also said that Romania must pay more attention on the way it transposes certain EU laws. “There are already many countries that see their national interest first, and then the European one and I don’t think it’s something wrong that we do the same.”

FinMin pledged that the debates on the tax codes will be concluded by the end of this year so that we can have a final version on January 1, 2019 that will not be amended anymore.

Tedorovici also announced a project to secure the customs offices at the borders with Ukraine, Republic of Moldavia and Serbia to counter tax evasion and the illicit traffic of cigarettes and other products. The minister explained that the project consists in a large procedure of scanning all products that are to enter Romania on every way, by air, railway or road vehicles. “It is an ambitious project, very hard to enforce, but by countering the illicit traffic we can bring at least EUR 1 billion every year to the state budget and then redirect this money to the sectors that mostly need funds, in stimulating business environment, healthcare and education.”

Minister Teodorovici also retorted to the BAT representatives who presented the company’s financial figures and who stressed that they are, through the plant in Ploiesti, one of the largest tax payers to the state budget, saying that such a contributor is doing no favour to the state, but it is just observing the law.

“This issue that you pay to the state budget… Of course, you pay, because we are doing business together. You pay what you have to pay, what the law says, you don’t pay anything additional. The idea is to do this in a large extent as possible. We, as a state, will stimulate you to create business,” the Finance minister stated.

At the same, following the same idea, he criticized the banking sector, for not being so much of a partner in the relation with the state, saying banks are not „really” partners of the business environment, at least not for now, but they are just financiers which are placing their money as conveniently as possible.

“I hear all the time that banks are also partners in the business environment…No. Banks will become partners when they will actually relax financing conditions very much on the market. It’s only then they will become real partners. Meanwhile, they are just financiers who are placing their available funds as conveniently as possible,” Teodorovici argued.

Last, the Finance Minister also heralded a draft to amend the existing workforce legislation in Romania in order to counter the workforce deficit on the local market. “There is a provision dating back in 2019 that says that the foreigners coming to work in Romania must by paid with the average salary, while for the locals must be paid just with the minimum wage. This gap, this condition must disappear. The market has to decide the value of the salary,” Teodorovici said, adding the revision is expected to be operated in early July.

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