Romania Reports Revenue Increase and Expenditure Cuts in Early 2025

Romania's Finance Minister Tanczos Barna reported a 23% increase in economic activity for January, as reflected in February's tax revenues, compared to February 2024. This improvement is particularly noted among major contributors, representing over 1,400 companies and 51% of the state's total revenue. While January showed slower growth and even reductions in some tax categories due to political instability affecting economic activity, February's figures align with the projected growth for 2025. The government has implemented measures to reduce expenditures, including freezing or reducing costs, eliminating payments totaling 127 billion lei through a December ordinance. These measures include a 5% reduction in operational and personnel expenses for most ministries, excluding Education, Health, and Internal Affairs. The Finance Ministry is controlling and obligating ministries to adhere to monthly and quarterly spending limits to meet the deficit target. These expenditure cuts will continue through 2026, aiming to freeze spending growth to reduce the deficit.