The tax rollercoaster
By Mihaela Pohaci and Raluca Rusu
This year commenced with contradictory new provisions in the tax field: on the upside, the long-awaited ‘holding regime’ has been introduced while the previously mandatory cash-based VAT system has been modified and made optional (just in time to avoid an infringement from the EU Commission). On the downside, additional tax burdens were introduced: increases of the excise duties on fuel but also a new tax — the ‘pole tax’. As covering all changes in the fiscal legislation would be a long story, we will briefly address only the high and the low of the ride.
After years of lobbying, the newly introduced holding provisions offer additional attractiveness to the local investment climate.
Under the new regime, subject to certain conditions, corporate tax exemption is available for certain income (dividends, sale of shares, liquidation of a Romanian entity) derived by investors (except companies not resident in ‘friendly’ jurisdictions, in other words with no conventions for the avoidance of double taxation)…
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