On 6 September 2024, Emergency Government Ordinance no. 107 of 4 September 2024 was published in the Official Gazette no. 905, regulating certain fiscal-budgetary measures concerning the management of budgetary receivables and the budget deficit of Romania’s consolidated general budget for 2024, as well as amending and supplementing certain normative acts.
The most important aspect addressed by this regulation concerns the tax facility granted to debtors, also known as tax amnesty. Below we briefly present the amendments introduced by this ordinance, the categories of persons who may apply, and the conditions that must be met in order to benefit from these facilities.
Categories of debtors
Please note that this ordinance applies to all categories of debtors, both individuals and legal entities, regardless of their form of association or whether they are governed by public or private law.
Monetary obligations eligible for the facility
In principle, the regulation includes within its scope all outstanding principal budgetary obligations as of 31 August 2024, including differences in budgetary obligations established by tax assessment decisions issued up to 31 August 2024.
There are, however, several exceptions, namely:
budgetary obligations established by final criminal judgments;
budgetary obligations that are the subject of ongoing criminal proceedings;
budgetary obligations representing damages that fall under the non-punishment causes provided by Article 10 of Law no. 241/2005 on the prevention and combating of tax evasion;
budgetary obligations owed to the budget of the European Union.
Legal conditions to benefit from the tax amnesty
According to Emergency Ordinance no. 107/2024, all debtors will benefit from the cancellation of interest, penalties, and all ancillary charges related to principal budgetary obligations if the following cumulative conditions are met:
All outstanding tax obligations as of 31 August 2024 are settled, by any means, by the date of filing the application or no later than 25 November 2024;
All principal and ancillary tax obligations with payment deadlines between 1 September 2024 and the date of filing the application, or no later than 25 November 2024, are settled in full;
All tax returns have been duly filed by the debtor by the date of the application;
The debtor files an application for the cancellation of ancillary obligations, after fulfilling the above conditions, no later than 25 November 2024.
With regard to differences in budgetary obligations declared additionally through corrective tax returns, an additional condition applies: the corrective return must be filed starting from 1 September 2024 until the date of the actual application, but no later than 25 November 2024.
It is important to note that ancillary obligations related to principal obligations that are paid after the entry into force of this ordinance are cancelled and subject to reimbursement.
Situation of budgetary obligations under RON 5,000 for individuals
Such claims may benefit from a 50% cancellation of the principal debt, including the cancellation of interest and other ancillary charges, provided that the remaining 50% is paid no later than 25 November 2024.
Situation of budgetary obligations exceeding RON 5,000 for individuals
Such claims may benefit from a 25% cancellation of the principal debt, including the cancellation of interest and other ancillary charges, provided that 75% of the amount is paid no later than 25 November 2024.
Special tax bonus granted to companies
The same ordinance also provides for an additional 3% tax bonus for companies subject to corporate income tax or micro-enterprise income tax, applied to the applicable tax rate. In order to benefit, companies must have all tax returns duly filed and all payment obligations fully settled.
Conclusion
In conclusion, debtors with outstanding obligations to the state budget should carefully analyze their financial situation, as these tax facilities are available only for a relatively short period of time, while their benefits may be felt in the long term.
Should you wish to obtain further information regarding the tax facilities introduced by the recent legislative amendments, our specialists are at your disposal.
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