VAT rise in Romania

The amount of the value-added tax has been increased from 19 to 24 percent in Romania according to a governmental decision.

The immediate tax increase was neccessary, because the Romanian Constitutional Court declared a part of the pension provisions within the Cabinet’s austerity package inconsistent with the fundamental law. The plan to decrease state wages by 25 percent and pensions by 15 percent was the part the Constitutional Court rejected. As a result of VAT increase, however, the markets reacted negatively and IMF announced the postponing of the transfer of the next loan installment due to the budget’s instability – reports Világgazdaság Online.