Last updated: 17 April 2019
At the end of 2018, the Government Emergency Ordinance no. 114/2018 introduced important amendments with a negative impact on the activity of some economic agents from various sectors (banking, energy, telecom). On 29 March 2019, the Government Emergency Ordinance no. 19 was published in the Official Gazette no. 245.
We have summarised below some of the main tax regarding:
ELECTRONIC COMMUNICATION
The GEO no. 114/2018 had introduced a tax for providers who wanted to be granted 3G, 4G and 5G licenses by means of a competitive or comparative selection procedure, going from 2% to 5% of the previous year’s turnover, multiplied by the number of years representing the validity period of the license. The normative act had also introduced larger penalties for providers (0,1% of the previous year’s turnover per day and up to 10% on the turnover) for the use of radio frequencies without a license or after the expiry of the license validity.
The GEO no. 19/2019 suspended until 1 September 2019 the penalty of up to 10% on the turnover for the providers of electronic communications networks concluding contracts for the installation, maintenance, replacement of the electronic communications networks and of infrastructure elements required to support them or performing property access works without the right of access or in the absence of the construction authorisation.
ENERGY
The GEO no. 114/2018, which had amended, among others, the Electricity and Natural Gas Law no. 123/2012 introduced a 2% annual contribution charged from the license holders in the electricity and gas sector.
According the GEO no. 19/2019 the 2% annual contribution charged form the license holders in the electricity and gas sectors shall not apply to holders of licenses related to the commercial exploitation for coal-based electricity production capacities, and neither the ones for the electricity and thermal energy production in cogeneration. The annual contribution charged from the holders of these licenses shall be established annually by order of the ANRE.
At the same time, the normative act mention that producers (including their subsidiaries and/or affiliates belonging to the same economic interest group) carrying out extraction and sales activities in respect of the natural gas extracted from the territory of Romania shall sell at the price of RON 68/MWh the natural gas quantities resulted from the current domestic production activity. This amendments shall apply for the period 1 May 2019 - 28 February 2022 (the previous period was 1 April 2019 – 28 February 2022).
Finally, for the computation of transport and distribution tariffs for electricity and natural gas, for the regulatory period 2019 - 2024, the rate of return on invested capital, expressed in real terms, before tax is 6.9%.
BANKING
The financial assets tax introduced by the GEO no. 114/2018 for credit institutions and their subsidiaries in Romania belonging to a foreign legal entity, based on the ROBOR quarterly average, was considerably amended by GEO 19/2019.
In fact, although the financial assets tax is maintained, it is considerably lower ( 0.4% per year, in case of banking institutions that hold a market share higher or equal to 1%, respectively 0.2 % per year, in case o the other banking institutions).
The tax base on which the tax rate is applied shall be represented by the net financial assets of the banking institutions existing the end of the semester or the end of the year for which the assets tax is due. The GEO specifically defines the term of net financial assets, specifying the categories of financial assets included in the tax base.