Taxation of tips did not fulfill the hopes of the Romanian government

By: Trademagazin Date: 2024. 02. 23. 10:17

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Taxation of tips did not fulfill the hopes of the Romanian government, much less tips were declared than expected, so less personal income tax was paid on this account for 2023 – according to the data of the tax authority (ANAF).

29.19 million lei (2.28 billion forints) of the personal income tax paid for tips received by workers in the hospitality industry went into the state coffers last year, ANAF announced.

In the draft budget for 2023, the Bucharest government calculated almost three times this amount, 95 million lei (7.40 billion forints) in this area. Based on the declaration and payment, around 300 million lei were paid in tips in the hospitality industry last year, while expert estimates estimate the value to be between 750 million and 1.5 billion lei. The Bucharest parliament adopted the legislation on the taxation of tips in the fall of 2022, and it entered into force on January 1, 2023. A 10 percent personal income tax must be paid on the tip, and pension insurance and health insurance contributions are not deducted from it.