A legislative initiative has been registered in parliament by MP Vyacheslav Nigai, who proposes to increase the threshold for mandatory registration of companies as VAT payers to 3.0 million lei. As a reminder, this minimum is currently set at 1.2 million lei in tax legislation. Representatives of the business community have been insisting on its increase for the past few years, as this threshold has long ceased to correspond to the current economic realities of Moldova.
As the author notes in the information note to the draft, the minimum established in the Tax Code has not been raised since 2018, despite the numerous crises and inflationary processes that have occurred during its period of validity. Therefore, in the current economic conditions, it hinders the development of small and medium-sized enterprises (SMEs).
If the amendment is approved, the costs of complying with tax legislation will decrease for a significant number of SMEs, allowing them to direct their resources towards investment and development. Among other benefits, he points to stimulating economic growth by encouraging SMEs to expand their activities; increasing the competitiveness of small businesses by enabling them to offer more attractive prices by not including VAT in the final cost of goods/services; reducing the administrative burden on the State Tax Service.
The accompanying note to the draft also notes that maintaining a low threshold for registration as VAT payers imposes a significant administrative burden on SMEs. They have to comply with a more complex tax regime, which entails additional costs for accounting and reporting, and managing VAT flows.
If approved, the new mandatory VAT registration threshold will apply from 1 January 2026.
