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“Secret tricks” of tax avoidance

Execution of surplus budgets for Social Security and Medicare in 2024 could have been even better if not for shadow payments by businesses," Logos Press reports.
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“Secret tricks” of tax avoidance

Based on the results of the Audit Chamber’s audit report, the parliamentary control committee was presented the main conclusions of the audits carried out on the execution of the social budgets, according to which the government has a lot to work on.

Among other things, there are the amounts of compensations for consumed energy and social assistance overpaid to the population. The State Social Inspectorate found 18.7 million lei in overpayments, which is about 40 per cent more than in the previous year.

The number of insured persons increased last year (823.8 thousand people) and so did the social insurance contributions paid for them. About 26 billion lei were transferred from employers to the accounts of the NCCI, which is equivalent to 59.1% of the total revenues of the social insurance budget. But it could have been more, if not for the “secret reception”.

The secret is the use of cash dividends by founders to pay salaries to staff. Auditors explain this phenomenon of tax avoidance by “cash financial sources” and “erroneously declared data on personal accounts of employees”.

The unobserved economy and informal employment remain a problem for insurance medicine as well. About 159 million lei was underpaid to health insurance funds because over 142,000 people did not pay fixed contributions (average of 2,100 lei), although they had jobs. Undeclared work and the phenomenon of salaries in “envelopes” do not stimulate health care, despite the frozen cost of the policy (4,400 lei).

About 8.4 billion lei (53% of the total amount), with an average annual contribution of 11,300 lei, amounted to contributions to the health insurance budget last year. However, the number of formal employees has decreased to 740 thousand, and the potential of fixed insurers has not been attracted to the system.


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