Profits tax

(Order no. 814/2013, published in the Official Gazette no. 385/28 June 2013)

The Order approves the Practical guidelines regarding the tax treatment applicable to certain operations performed by credit institutions that apply the IFRS accounting standards.

Tax procedure

Amendments to the Fiscal Procedure Code

(Emergency Ordinance no. 50/2013, published in the Official Gazette no. 320/3 June 2013)

Starting with 1 July 2013, the level of the late payment penalties is 0.02% per day of delay.

However, for the outstanding tax liabilities due before 1 July 2013 that are settled after this date, the applicable level of late payment penalty would be the one valid up to 1 July 2013 (i.e. 5%, respectively 15%).

Postponement of tax liabilities

(Emergency Ordinance no. 50/2013, published in the Official Gazette no. 320/3 June 2013)

The Emergency Ordinance introduces facilities for taxpayers which have outstanding receivables against the Romanian authorities managing EU funds on the basis of the financing agreements concluded with the respective authorities. Such taxpayers may request, in certain conditions, the postponement of outstanding tax liabilities, including the late payment charges.

Rescheduling of tax liabilites

(Emergency Ordinance no. 50/2013, published in the Official Gazette no. 320/3 June 2013)

Amendments and completions are brought to Emergency Ordinance no. 29/2011 regarding the rescheduling of tax liabilities payments. Such changes and amendments include:

• the payment rescheduling maintains its validity provided that the taxpayer settles, within 180 days from the date when decision for rescheduling of tax liabilities is issued (instead of 90 days), the tax liabilities which were outstanding at the date of issuance of the decision for which summons were communicated; and

• the possibility of changing the payment rescheduling decision so as to include, at the taxpayer’s request, the tax liabilities established by the tax inspectors through tax decisions with payment deadline after the date when the rescheduling decision was issued. In this respect, the taxpayer may request a new scheduling period, different from the one already approved.

Amendments to Order No. 700 / 2012 for the approval the procedure for the ex-officio change of the VAT fiscal vector

(Order no. 606/2013, published in Official Gazette no. 351/13 June 2013)

The procedure for the ex-officio VAT registration / de-registration of taxable persons was amended in order to be in line with the provision of the Fiscal Code (e.g. in case of non-submission or submission of nil VAT returns for a period of 6 consecutive months, respectively 2 consecutive quarters, the date of the ex-officio VAT de-registration will be the first day of the month following the one in which the submission deadline occurred for the sixth, respectively second VAT return).

Procedure for the implementation and administration of the single tax group (VAT group)

(Order no. 607/2013, published in Official Gazette no. 345/12 June 2013)

The Order approves the procedure, as well as the form templates to be used for the implementation, amendment or cancellation of the VAT group.

Withholding tax

Double Tax Treaties

(Decree no. 597/2013, published in Official Gazette no. 369/20 June 2013)

The Decree sends for ratification to the Romanian Parliament the Treaty concluded between Romania and Uruguay for the avoidance of double taxation and prevention of fiscal evasion with respect to taxes on income and capital. The Treaty was signed on 14 September 2012.

State aids

”De minimis” state aid scheme for the implementation of local development strategies and cooperation projects

(Order no. 512/2013, published in Official Gazette no. 374/25 June 2013)

The objective of the “de minimis” state aid scheme is the one provided by the National Program for Rural Development and aims to increase the competitiveness of the forestry and agricultural sectors, improve the rural environment, increase the life quality and diversify the economic activities in rural sectors.

The maximum estimated value of the “de minimis” state aid is of EUR 191.77 million. The scheme is applicable from the date of its approval up to 30 June 2014.

Human Capital

(Emergency Ordinance no. 55/2013, published in Official Gazette no. 331/6 June 2013)

The Emergency Ordinance brings an amendment to the Fiscal Code providing that an income tax rate of 85% is applicable to income representing salaries/indemnities/compensatory amounts paid further to the termination of work relationship for employees holding management positions or for mandates of members of the board of directors / management.

The draft Law for approving the Emergency Ordinance limits the application of the above-mentioned amendment to the Financial Supervision Authority or authorities provided by Emergency Ordinance no. 93/2012 (i.e. National Securities Commission, Insurance Supervisory Commission and Private Pensions System Supervisory Commission).

Miscellaneous

ANAF reorganisation

(Emergency Ordinance no. 74/2013, published in the Official Gazette no. 389/29 June 2013)

The Emergency Ordinance provides certain measures for the improvement and reorganization of the activity of the National Agency of Fiscal Administration ('ANAF'). The measures include, inter-alia, the merger by absorption and the take-over by ANAF of the National Customs Authority’s activity, as well as the take-over of the Financial Guard’s activity, both the National Customs Authority and the Financial Guard being dissolved.

Stamp duties

(Emergency Ordinance no. 80/2013, published in the Official Gazette no. 392/29 June 2013)

The Emergency Ordinance approves the new levels of the judicial stamp duties, as well as the situations in which they are due

For additional information, please contact:

Venkatesh Srinivasan, Partner – Head of Tax and Legal

Ernst & Young SRL and E. Platis, C. Bazilescu LLLP

15-17 Ion Mihalache Blvd.

Bucharest Tower Center Building, 22nd Floor

Sector 1, 011171, Bucharest, Romania

Tel: (40-21) 402 4000, Fax: (40-21) 310 7124

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