The minimum tax will be eliminated come fall. Real lump sum taxation will then be introduced, the mathematics behind which is still unknown

Redactor:
Simona Simionescu
The minimum tax will be eliminated come fall. Real lump sum taxation will then be introduced, the mathematics behind which is still unknown
The tax burden of companies will get a bit lighter come fall, once the minimum tax is eliminated, promise both Prime Minister Emil Boc and Minister of the Economy, Adriean Videanu. They have yet to mention if the current tax will be replaced with lump sum taxation.

The tax burden of companies will get a bit lighter come fall,once the minimum tax is eliminated, promise both Prime MinisterEmil Boc and Minister of the Economy, Adriean Videanu. They haveyet to mention if the current tax will be replaced with lump sumtaxation. At the same time, the Prime Minister has announced thatthe flat tax rate will not be changed, because progressive taxationwould not raise state budget income. „The minimum tax will beeliminated come this fall. We have long since evaluated and saidthat this minimum tax has produced the effects desired and it willbe eliminated come this fall”, stated Boc, at the launch of the”2010 White Paper of SMEs in Romania”. The measure could be appliedOctober or November 1st, says Videanu, who added that the Ministryof Finance has done its calculations. The minimum tax wasintroduced May 1st 2009, and varies between 2200 Romanian Lei p.a.(the equivalent of roughly 500 Euro) for companies with a turnoverof no more than 52,000 Romanian Lei and 43,000 Romanian Lei p.a.(approximately 10,000 Euro) for companies with a turnover of morethan 129 million Romanian Lei.

„Wise guys make promises, fools actually expect them tobe kept”

Until the minimum tax is eliminated – which was confused withlump sum taxation by authorities from the very beginning -entrepreneurs are being reserved about this, because this isn’t thefirst time they’ve heard such announcements. The idea also made therounds last fall, when the Government said it would be appliedmid-2010, by replacing it with lump sum taxation for fields ofactivity that have high rates of tax evasion, which include beautyparlors, restaurants, and mortuary services. „We’re sick of sittingaround and hoping. You know that old Romanian saying: Wise guysmake promises, fools actually expect them to be kept. We ask thatthe Government keep its word”, said Neculai Vițelaru, VicePresident of the National Council of Small and Medium Sized PrivateEnterprises in Romania (CNIPMMR) on Friday. Aware of the fact thatthe business environment can’t escape untaxed, entrepreneurs areasking the Ministry of Finance officials not to introduce lump sumtaxation without a sectoral analysis, specifically with regards to”sectors that manage national wealth but have small profit rates,such as the alcohol, tobacco, and oil industries”. They’re notwasting any time believing that our economy’s going to get bettersoon. As such, most entrepreneurs think that the peak of the crisiswill be this year, while only a quarter of those that took part ina poll conducted by CNIPMMR believe 2011 will be an even tougheryear.

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