The Romanian government maintains that it will not increase taxes, despite raising the dividend tax. However, a massive fiscal reform appears unavoidable. Measures outlined in the "train ordinance" will only yield about a third of the additional budget revenue promised to the European Commission, totaling nearly 27 billion lei this year.
The budget deficit for the first 11 months of 2024 has reached 7.12% of GDP, up 4.58% from the previous year.
As previously reported, a significant fiscal revolution is on the horizon. The introduction of a progressive tax rate is expected, but its implementation may take time. Discussions with the European Commission have revealed other points that will be implemented, potentially not aligning with current figures, as early as 2025.
These measures will impact everyone, particularly small businesses, which have already faced multiple challenges. The increase in payroll taxes, property taxes, and possibly VAT appears to be a strategy that could jeopardize the survival of hundreds of thousands of small companies.
The "train ordinance" has only implemented two measures discussed with the European Commission: lowering the threshold for micro-enterprises and increasing the dividend tax, both significantly affecting small firms' balance sheets. The increase in dividend tax will impact all individuals receiving income from such sources, particularly shareholders of small firms, who will pay more to withdraw profits. Since 2021, annual measures have targeted micro-enterprises, leading to a tax burden that has escalated from around 11-12% in 2021 to over 25% today.
In 2025, an additional blow will come with an expected rise in the profit tax from 16% to 19%, with discussions considering an increase to 20%.
Alongside the profit tax, income tax will also rise, projected to reach approximately 20% over time, with an immediate increase to 12% from 10% in 2025. Furthermore, a VAT hike to 21% is under consideration, although debates continue regarding the introduction of a progressive tax rate as an alternative.
Property taxes, including those on vehicles, homes, and land, will increase concurrently with reduced budget allocations to municipalities, allowing for more funds to remain in the national budget.