Last Ciolos cabinet sitting: 20 decisions prorogued, over-taxation in energy sector – in force for one more year

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In the last sitting of the Dacian Ciolos cabinet, the executive has postponed more than 20 decisions from coming into force, if implemented next year would have led to a 10% budget deficit. Similar decisions were adopted by former governments during the past six years, according to

For the time being the granting of holiday vouchers is abandoned, as well as the payment for overtime. The delaying of tax cuts, as recently requested by PSD leader Liviu Dragnea, was not considered, the same source reports.

The government approved on Thursday a draft Emergency Ordinance which includes several fiscal-budgetary decisions. One of them is the increase of the pension point by 5.25% as of January 2017. Some decisions on state employees’ wages increase have been prorogued, such as the granting of meal vouchers, of gift vouchers and holiday vouchers, as well as the postponement by one year of the over-tax lifting for energy companies and for companies involved in natural resources, reports.

The Ciolos cabinet has postponed for another year the increase of contributions to the second pillar of the mandatory private pension. It would have reached 6% this year, however it will increase only to 5.5%, after the level last year of 5.1%.

The ordinance also postpones the granting of the aid of EUR 500 for every new-born child, awarded by the Education bill in 2011 and which was never put into practice.

According to the source, analysts say the PSD governing programme is rather too ambitious, considering the budget resources and the huge number of promises made during the election campaign. They stress this is one of the reasons for which PSD leader Liviu Dragnea had asked PM Dacian Ciolos to prorogue several tax cuts such as the VAT from 20% to 19%, adding that it is too late for amending the tax code.

Labour Minister Dragos Pislaru: No cuts

“I want to tell you there will be no cuts. No cuts in wages, bonuses, nothing. This government does not cut wages, no such decisions on salaries. I want to tell you the pension point will increase by 5.25% to RON 917.5 from RON 871.7. In this way we eliminate any doubts regarding the intentions of this government regarding the pension system. The pensions for military will be increased accordingly,” Labour Minister Dragos Pislaru said Thursday evening.

Finance Minister Anca Dragu: The next government will conduct its policy as it sees fit

“We do not cut wages, we do not freeze salary rights. It is about proroguing bills approved in the past years, generally before the crisis. They have been postponed every year, along with the budget bill. This year, as the budget bill might be approved in January, we have decided to postpone their implementation. Practically, we give the opportunity for the next government to conduct its policies as it sees fit. We are not postponing the Tax Code, it will be implemented as decided for 2017,” Finance Minister Anca Dragu said.

The finance minister added that the implementation of the Education bill will be postponed, in terms of allotting 6% of the GDP for education and 1% for research. “These decisions have been postponed year by year. There’s nothing new,” Anca Dragu said.

According to the head of finances, by failing to postpone such decisions by Emergency ordinance would lead to a RON 49 billion negative impact on the budget, i.e. 6.8% of the GDP in 2017.


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