Andrian Gavriliță
According to the ministry, although representatives of the professional community appreciated the reform’s objective and called the idea itself “very good,” they requested more time to study, refine, and implement the new rules.
“We held discussions with the Association of Accountants, among others, because they also had questions. And when we moved on to clarifying these issues, they said, ‘Wow! This is a great idea, just not entirely clear,’ said Finance Minister Andrian Gavriliță on the ZdG podcast.
He explained that the ministry was aiming for a phased—two-step—implementation of the flat payroll tax.
“Today we have social insurance contributions, health insurance contributions, income tax, and personal exemptions—in other words, the administrative mechanism is quite complex. When I explained that the goal was to arrive at a single, unified, and equal payroll tax for everyone in order to eliminate these administrative complexities and headaches, they noted that the initiative was very welcome, but added: “Please let’s move a little slower so that we all have time to understand, refine, and implement it.” And we agreed,” the minister noted.
One-Year Deferral
Another topic of discussion was the impact of the changes on local authorities, whose revenues are generated in part by income tax receipts. Although some of the concerns raised were addressed, the ministry concluded that it was not worth rushing the reform amid ongoing uncertainty.
As a result, the authorities decided to postpone this component of the reform in order to continue consultations and prepare the mechanism. This will allow the implementation to be postponed until next year.
As a reminder, the initiative called for shifting the entire tax burden on wages to employees by combining income tax, social security contributions, and health insurance into a single mechanism. At the same time, the plan was to set a fixed social security contribution rate of 21% (instead of the current 24% for most workers) and reduce the health insurance contribution from 9% to 7%.
Earlier, President Maia Sandu stated that this reform had been developed by a group of experts commissioned by the World Bank, who assessed public sector positions in terms of their complexity, required competencies, and level of responsibility.
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