The Romanian Government will have to pay back the first registration car tax to car owners, an amount of EUR 400 million, a tax taken illegally by the former administration, the country's Prime Minister Victor Ponta recently said.

The Prime Minister said last week that the Government will have to change legislation so as to return the car tax illegally collected, thus relieving the courts of the lawsuits for refunds.

“It is clear that the law adopted earlier did not correspond to European or constitutional  norms and that the Government will have to give the money back. We must carry out this procedure, at least to void having judges and court clerks spend time on making decisions which all point to the same direction: the Government should pay back the money”, Ponta then said.

In his opinion, the decision of the previous governments to urge vehicle owners to sue the state to recover the car tax was incorrect, illegal and immoral.

The Car Tax law for car pollution, enacted earlier this year, provides a backdated pollution tax reduction of 25 percent, allowing car owners to demand repayment, if the pollution tax paid from July 1, 2008 is higher than the amount calculated under the new law.

Ioana Toader, ioana.toader@romania-insider.com