According to the authors, it is designed to simplify the tax system, stimulate investment and economic growth, and create a modern and fair tax system.
Zero corporateincome taxrateand excise tax refunds for farmers
As Finance Minister Andrian Gavrilita explained, this is a policy for “citizens who work and invest.”
Among the main proposed measures are a reduction in the number of tax regimes, as well as taxes and fees; the application of a zero rate on reinvested (undistributed) profits for all enterprises; the introduction of an automatic VAT refund mechanism, as well as excise tax refunds for agriculture and the simplification of administrative obligations for taxpayers.
The zero rate on reinvested (undistributed) profits will apply to all enterprises, and if profits are distributed, the enterprise will pay a 15% income tax plus a 7% tax on dividends.
Elimination of the 8% reduced VAT rate
Significant changes are planned for VAT. First, it is proposed to abolish all reduced rates of 8%, and the zero rate will apply only if provided for by the European Directive on Value Added Tax.
All other goods will be subject to a 20% VAT rate. Starting April 1, 2027, it is proposed to introduce a standard VAT rate on energy, including electricity, which is currently subject to a zero VAT rate.
In addition, it is proposed to expand the list of goods subject to excise tax. For example, to apply it to carbonated sweet drinks, e-cigarette liquids, fireworks mixtures, and others.
Regarding property tax, it is proposed to establish a regulated rate ranging from 0.1% to 1% of the market value of the property starting next year.
Unification of Tax Regimes
The unification will also affect all tax regimes used by entrepreneurs engaged in independent activities in the fields of law, medicine, and others, in addition to independent entrepreneurs engaged in trade.
The authorities thus intend to expand the use of the tax regime for freelancers to include individual entrepreneurs engaged in various types of activities.
If they wish, they will be able to switch to the regime currently used by independent entrepreneurs (freelancers) and pay a single tax of 15%.
All those currently registered under this regime will be able to continue working, but no new users of these individual regimes will be registered. The same applies to patent holders.
“Through the proposed measures, we aim to create a simpler, more transparent, and more competitive tax system that will promote investment and sustainable economic growth,” notes Finance Minister Andrian Gavrilita.
