The Romanian Government approved on Wednesday, January 14, the reduced VAT rate of 9% for half board / full board / all-inclusive accommodation services. This measure will impact the state budget this year by about RON 100 million (over EUR 22 million).

“In order to apply the reduced VAT of 9% for half board / full board / all-inclusive accommodation services, the Government approved the decision to modify the rules for the application of the Tax Code, in order to correlate tax legislation regarding the application of the reduced rate VAT with specific legislation in tourism,” according to a statement of the Government, cited by local Mediafax.

Prime Minister Victor Ponta announced in December last year, after talks with experts from the International Monetary Fund and the European Commission, that the VAT will drop from 24% to 9% for the all-inclusive tourism packages.

Irina Popescu, irina.popescu@romania-insider.com