Last updated: 6 November 2018
Recently published in Official Journal no. 854 of 9.10.2018, Emergency Ordinance no. 89 of 4.10.2018, introducing certain fiscal and budgetary measures and aimed at amending and supplementing certain regulations ("OUG no. 89/2018") brings a series of new and much needed clarifications.
TAXPAYERS WHO CAN RECEIVE BONUSES
Given that all taxpayers obliged to file the unique statement concerning the income tax and social security contributions must benefit equally from the bonuses granted for the advance payment of their tax obligations, OUG no. 89/2018 clarifies the categories of taxpayers who benefit from these bonuses. Thus, in 2018, the following bonuses are granted:
- for the electronic submission of the unique statement regarding the income tax and social contributions until 15 July 2018 included, the taxpayer will receive a bonus of 5% of the total amount of the income tax paid in full until 15 March 2019 included, representing the annual tax obligations for 2018. The amount of the bonus diminishes the income/annual net revenue tax and/or the annual income tax to be paid.
- for the advance payment of the income tax, the taxpayer will receive a bonus of 5% of the estimated annual income tax declared under the unique statement and paid in full until 15 December 2018 included. The amount of the bonus diminishes the estimated annual net income tax and/or the estimated annual income tax to be paid.
THE OBLIGATION TO PAY THE CONTRIBUTION TO THE HEALTH FUND
The taxation decision concerning the contribution to the health fund due by the natural persons who opted for the payment of this contribution (even if their annual income was below the minimum threshold provided by the law, i.e. 12 minimum wages at the national level) is effective until the date of submission of the unique statement.
The cancellation of the obligation to pay the contribution to the health fund stablished under the taxation decision will be performed by (i) the declaration of income in the unique statement or by (ii) the notification of the tax authority by taxpayers who are exempt from the payment of the contribution (pursuant to the law). In such a situation, the obligation to pay the contribution to the health fund established under the taxation decision is canceled from the month when the unique statement is filed or from the month when the notification is submitted.
If the taxpayer does not express his option to pay the contribution to the health fund by filing the unique statement, the taxation decision remains valid until the deadline for filing the unique statement regarding the estimated income to be obtained in 2019.
NEW PAYMENT DEADLINES AND BONUSES FOR TAXATION DECISIONS TO BE ISSUED
The provisions of OUG no/ 89/2018 also introduce new payment deadlines and new bonuses for the annual tax decisions to be issued and communicated by the tax authority after the date of entry into force of OUG no. 89/2018 for the period 2014-2017, as follows:
- the deadline for the payment of the annual tax on the income earned by natural persons in 2017 and of the social security contribution due by natural persons for the period 2016-2017 is 30 June 2019. For the anticipated full payment of these amounts until 15 December 2018 included, the taxpayer will receive a bonus of 10% of the said amounts;
- the deadline for the payment of the individual contribution to the health fund due by natural persons for the period 2014-2017 is 30 June 2019. For the anticipated full payment of these sums until 31 March 2019 included, the taxpayer receive a bonus of 10% of the said amounts.
APPLICATION OF THE 5% VAT RATE
In addition, OUG no. 89/2018 extends the scope of the reduced VAT rate of 5% to three new categories of deliveries of goods and services (provisions applicable from 1 November 2018):
a) accommodation in hotels or similar units, including the rental of campgrounds;
b) restaurant and catering services, except for alcoholic beverages, other than beer;
c) the right to use sports facilities.
As a result, the new provisions in tax law introduced by the OUG no. 89/2018 aim to reduce tax evasion, encourage the advance payment of taxes, as well as to stimulate economic growth in Romania.