- Romania’s President-elect Nicușor Dan has ruled out a standard VAT rate increase despite the government considering a 2% rise, with ongoing coalition talks still including VAT options.
- Sources indicate the Finance Ministry had modeled a VAT rate increase for May 2025 due to fiscal pressures but currently, no changes to reduced rates or upshifts are expected.
- Romania’s missed deadline for its deficit report to the EU and a 2024 deficit of 9.3% of GDP highlight the country’s fiscal challenges, risking economic and funding repercussions.
- Government debates about a VAT rate increase reflect concerns over growth targets, debt levels, and EU funding, with coalition tensions causing delays in the approval of fiscal measures.
- Romania’s Finance Ministry and Prime Minister previously dismissed VAT increase rumors, citing alternatives like spending cuts and e-invoicing to reduce the VAT gap without raising rates.
- The e-invoicing rollout and RO eVAT reporting aim to improve tax compliance, but economic pressures, coalition disagreements, and EU scrutiny keep VAT rate adjustments on the table.
Source: vatcalc.com
