Gov’t analyses two tax amnesties – 300,000 businesses and individuals targeted

Finance Minister Eugen Teodorovici presented on Tuesday a draft through which state debtors could pay only half of arrears. More than 300,000 companies, state institutions and individuals, which have debts of over RON 60 billion, are targeted.

Officials with the Ministry of Finance are considering two measures, stirileprotv.ro reports.

State-owned and private firms, as well as public institutions that have accumulated debt of over RON 1 million by December 31, 2018, are to be exempted of half of the amount. For this, they have to draw up a restructuring plan and pay the arrears in installments under the strict supervision of the Tax Authority.

Almost 2,800 companies could benefit from this “amnesty”, of which 31 are state-owned companies.

However, business representatives say the measures are for the benefit of state companies or incorrect firms.

Florin Jianu, chairman of the SME Council: “We do not want changes that help some at the expense of others. In fact, it’s a tax amnesty masked for state-owned companies. The economic environment has not called for this. Those who are not correct must be removed from the market at some point. What do we do with state-owned companies? Are we to issue tax amnesties every 4-5 years?”

The second measure prepared by the Finance Ministry is for natural persons and companies that have overdue payments of less than RON 1 million and who will be able to benefit from the half-cutting of interest and penalties. They have to pay the main debt by November 30, 2019. The arrears accumulated by these companies and people are impressive: more than RON 37 billion.

This category includes 312,000 debtors, of which less than 10% are natural persons and those who work independently. The vast majority are private companies – over 285,000, with debts of over RON 25 billion.

For the time being, the measures are only a draft. According to estimates made by the Finance Ministry, only 5% of debtors with over RON 1 million arrears could choose the restructuring options.