The draft law provides for granting independent entrepreneurs (freelancers) the right to engage in any activity, proposing to repeal the Appendix to Chapter 104 of Section II of the Tax Code.
The authors of the initiative assert that implementing this measure will create a legal framework for any individual to legalize and pay taxes on a wider range of independent activities, simplify tax legislation by creating an accessible and predictable tax system for individuals.
Currently, according to the Annex to the Tax Code, the list of 40 fields of activity open to registration by freelancers is set forth in the Moldovan Classification of Economic Activities (KEDM-2).
The list specifies the fields of work in which one can officially engage in freelance activities. You can view it here.
Revision of Tax Rates and Contract Limits
At the same time, it is proposed to revise the annual income ceiling for independent entrepreneurs in order to establish a flat tax rate of 15%, which will be lowered from 1.2 million lei to 1 million lei, along with a reduction in the maximum applicable flat tax rate from 35% to 30%.
It should be noted that Article 6927 will be supplemented with special provisions establishing rules regarding the conclusion of contracts with independent contractors for tax purposes.
Thus, legal entities or individuals engaged in business activities will be permitted to enter into contracts with independent contractors up to 3% of the relevant taxpayer’s annual payroll for the tax period.
Any amount exceeding the 3% limit will be considered a non-deductible expense and will be taxed at a rate of 15% of the excess amount.
At the same time, expenses incurred by a legal entity in connection with independent contractors will be deductible for tax purposes within the limits specified above (amendments made to Article 24 of the Tax Code).
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