Last updated: 26 March 2020
The Emergency Ordinance of the Government no. 29/2020 on certain economic and tax & budgetary measures aimed at mitigating the negative effects on the economy caused by the COVID-19 pandemic has been published in the Official Gazette no. 230 as of March 21, 2020. The Ordinance enacts a series of economic measures shaped as to ensure the continuity of working capital for SMEs and microenterprises.
The main measures adopted under the Emergency Ordinance of the Government no. 29/2020:
INCENTIVES ON INVESTMENTS / WORKING CAPITAL UNDER THE PROGRAMME FOR SMEs - «IMM INVEST ROMANIA»
State loan guarantees granted for the following type of loans:
1. The granting of State guarantees accounting for maximum 80% of the value of the funding (interests, bank fees and charges excluded) for investment and / or working capital loans
- the maximum amount of the loans / credit lines for working capital - limited to LEI 5,000,000, without exceeding the average of the working capital related expenditures for the latest two fiscal years ;
- the maximum amount for the funding of the investment loans – LEI 10,000,000 ;
- the maximum aggregate of the State guaranteed funding per beneficiary within this incentive - LEI 10,000,000.
OR
2. The granting of State guarantees for working capital loans accounting for maximum 90% of the value of loans (interests, bank fees and charges excluded) limited to LEI 500,000 for microenterprises and LEI 1,000,000 for small-sized enterprises, without exceeding the average of the working capital related expenditures for the latest two fiscal years.
The subsidized interest rate is 100% under a state aid/ de minimis scheme (since granting and until March 31, 2021 at the latest).
The financing is granted for maximum 36-month term for working capital loans, with the possibility of extension for another 36-month term. For investment loans, the 120-day term is maintained.
EXTENSION OF CERTAIN TIME LIMITS
1. The time limit for the payment of the first instalment of the local taxes (the tax on buildings, terrains and transport means) is no longer March 31, 2020 but June 30, 2020. The corresponding reductions granted for advance payment thereof until June 30, 2020 have been maintained (maximum 10% of the amount to be paid) ;
2. The time limit for submitting to the tax body of the notice on the intention of the restructuring of the budgetary obligations has been extended until July 31, 2020, and the term for submitting the request for the restructuring of the obligation – until October 31, 2020, the debtor incurring a risk of loss of such right ;
3. The time limit for the submission of the declaration on the beneficial owner by companies, associations and foundations has been shifted to 3 months after the emergency state ceases. The submission of the declaration on the beneficial owner is suspended during the emergency state.
TAX INCENTIVES
1. During the emergency state and for the 30-day period following to the cessation thereof, the following fiscal measures apply:
a) Enforcement measures by seizure of the budgetary debts shall be suspended or shall not be initiated, unless such enforcement arises of legal decisions rendered by courts in criminal matters. Such measures aimed at the suspension of enforcement by the seizure of the debtor’s recoverable revenues and liquidities shall, as under the law provided, be enforced by credit institutions and third parties subject to attachment, without other formalities by the tax bodies being necessary.
b) For the fiscal obligations reaching maturity at the date of entering into force of the EOG no. 29/2020, namely March 21, 2020, and unpaid until the measures provided for by this ordinance cease, no interests and late payment penalties shall be established and due as pursuant to the Fiscal procedure Code.
Tax returns are to be filed until March 25, 2020, but if payment is not made until the same date, there shall not be late payment penalties.
2. Taxpayers who chose the annual tax return and payment system with quarterly prepayments, may execute quarterly prepayments for the year 2020 by taking into account the amount of the current quarterly profit tax (as compared to previous regulation whereby prepayments were established based on the profit tax due for the preceding year adjusted according to the consumer price index). The calculation formula remains the same for all the quarters of the fiscal year 2020.
3. During the emergency state, the SMEs having totally or partially ceased their activity as under the decisions issued by the competent public authorities, and holding an Emergency state Certificate issued by the Ministry of Economy, Energy and the Business Environment shall benefit from delayed payment for utilities – electricity, gas, water, telephone and internet services as well as delay payment of the rent for the premises where the registered headquarters and places of business are established.
4. By derogation from other legal provisions, the force majeure can be invoked for running agreements of SMEs, other than those under point 3), but only after the renegotiation attempt, upon producing proof thereof by written communication between the parties, via electronic means included, for adjusting the clauses thereof in consideration of the exceptional conditions generated by the emergency state.
5. Penalties stipulated for delaying the execution of obligations arising from the agreements concluded between SMEs and public authorities are not due during the emergency state.
6. The provisions as under point 3) shall also apply correspondingly, for the following professions providing services of public interest: (i) the forms of exercise of the profession of public notary, (ii) the forms of exercise of the profession of lawyer and (iii) the forms of exercise of the profession of enforcement officer, (iv) family medicine offices and dental offices whereby no more than 20 persons are working, (v) national sports federations and sports clubs holders of a sportive identity certificate and whose activity is directly impacted upon by the measures enforced by the public authorities. The criteria to be met for qualifying as beneficiary of such measure are to be set out by decision of the Government.
Bucharest, 25 March 2020