Legislative summary, July 2011
VAT

VAT exemptions

(Order no. 2230/2011, published in the Official Gazette no. 498/13 July 2011)

The Order brings certain amendments regarding the documents needed for the application of the VAT exemption for the export of goods and work on movable goods which subsequently are transported outside the Community.

Moreover, in case of intra-community supplies of goods, if during a tax audit the tax authorities identify that the VAT ID number of the beneficiary was erroneously mentioned on the invoice, to benefit of the VAT exemption, the supplier is permitted during the audit to correct the invoice and the validity of the VAT ID of the beneficiary will be verified by the tax authorities.

Human Capital

Payment of salary tax

(Order no. 2351/2011, published in the Official Gazette no. 464/1 July 2011)

According to the clarifications brought by the Order, the salary tax due by the secondary offices shall be paid using the fiscal identification number attributed to the secondary offices, opened with the State Treasury office that administers the tax payers that have established the respective secondary offices.

However, the outstanding amounts representing salary tax, not settled until July 2011, shall be paid using the fiscal identification number and Treasury account of the taxpayers that established the secondary offices.

Foreign citizens’ regime in Romania

(Law 157/2011, published in the Official Gazette 533/28 July 2011)

The new law amends “permanent residence” to “long term residence”, imposes additional documentary requirements for work permit applications and sets out regulations for EU Blue Card applications.

For more details, please refer to our Human Capital Alert no. 8 of August 2011.

Customs

Customs duty suspension for certain LCD monitors

(Council Regulation no. 555 / 6 June 2011)

The Council Regulation was issued to extend the customs duty suspension for certain LCD monitors, which expired on 31 December 2010, with retrospective effect for the period from 1 January 2011 up to 30 June 2011. Since the duty suspension expired on 31 December 2010, during the interim period (i.e. from 1 January 2011 until the date of the Council Regulation – 6 June 2011) importers were paying customs duty upon import of such LCD monitors. Based on this Council Regulation, the importers can now file refund claims with the customs authorities for the duty paid during the interim period.

For more details, please refer to our Tax Alert no. 12 of July 2011.

State Aid

State aid scheme granted to small and medium enterprises

(Government Decision no. 682/2011, published in the Official Gazette no. 489/8 July 2011)

The Decision approves the methodological norms for the application of Emergency Government Ordinance no. 60 regarding the implementation of a state aid scheme for supporting the need for short-term liquidity (i.e. 1 year), granted to small and medium enterprises. This scheme provides for a subsidy of up to 70% of the interest paid to the credit institution, if certain eligibility criteria are met.

Accounting

Accounting reporting system as of 30 June 2011

(Order no. 2234/2011, published in the Official Gazette no. 483/7 July 2011)

The accounting reporting system as of 30 June 2011 is applicable to the entities that are subject to the Accounting regulations in accordance with the Fourth Directive of the

European Economic Communities, approved by the Order of the Minister of Public Finances no. 3055/2009, that in the previous financial year recorded a turnover exceeding the RON equivalent of EUR 35,000.

For more details, please refer to our Tax Alert no. 11 of July 2011.

The simplified accounting system

(Order no. 2239/2011, published in the Official Gazette no. 522/25 July 2011)

The Order provides the content of the simplified accounting regulations as well as the rules regarding the approval, the signing and the publishing of simplified financial statements.

The provisions of the Order are applicable starting with the financial statements for the financial year 2011.

For more details, please refer to our Tax Alert no. 13 of August 2011.

Fiscal Procedure Code

Non-constitutionality of certain provisions regarding the communication of the fiscal administrative document

(Decision no. 536/2011, published in the Official Gazette no. 482/7 July 2011)

The Decision admits that the provisions of art 44, para (3) of the Fiscal Procedure Code are non-constitutional to the extent that such provisions are interpreted in the way that the tax authorities can communicate the fiscal administrative document via publicity unduly disregarding the order of communication methods stipulated at art 44, para (2), letters a) - d), according to which the communication via publicity is the last possible way of communication.

Banking and insurance

NBR reference interest rate

(NBR Circular no. 22/2011, published in the Official Gazette no. 464/1 July 2011)

The NBR reference interest rate for June 2011 is 6.25% per annum.

By Venkatesh Srinivasan, Partner – Head of Tax and Legal, Ernst & Young Romania

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