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country-icon Romania

10.31.23

VAT increase for specific supplies

Romania is currently undergoing a busy period in its fiscal affairs as it assesses its strategy to mitigate its VAT gap, stabilise the economy and introduce a fiscal policy that is beneficial for consumers. Romania’s VAT gap was calculated only recently to be a staggering 36.7% of their expected VAT revenue- which means fiscal planning will be at the forefront of the Romanian government’s agenda.

After having mandated high fiscal-risk products in July 2022, where specific goods coming under this category need to be submitted via Romania’s e-invoicing national platform, the RO e-Factura, plans to monitor business taxes, and in particular, VAT activity, have been taken yet further with the proposed introduction of a universal Business-to-Business (B2B) e-reporting and e-invoicing mandate, which puts a greater scope of transactions subject to e-invoicing obligations.

But Romania’s fiscal tax strategy does not stop there- the Romanian tax authorities have also been scrutinising the country’s VAT rates.

As well as a new 9% VAT rate for beverages which is currently under consideration by the Romanian Senate, Romania is also proposing to increase VAT rates on various supplies in 2024.

Potentially impacted categories include specific social housing, solar panels and specific food deliveries being subject to the higher reduced rate of 9%, rather than 5%.

Specific sugary foods will also be subject to the higher standard rate of 19%, rather than the reduced VAT rate in the country- although it is likely that wider health agendas triggered this specific element of the proposal.

These fiscal reforms have been presented to Parliament.

Romania is a compliant territory for Kofax and our e-invoicing solution today incorporates all valid VAT rates in the country. The proposed VAT changes outlined above include VAT rates that are covered by Kofax’s e-invoicing solution today.

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