GEO no. 99/2020 – new fiscal measures and extensions of deadlines for the facilities already granted

GEO no. 99/2020 – new fiscal measures and extensions

GEO no. 99/2020 was published in the Official Journal of Romania, on 25 June 2020. The GEO extends the application of fiscal measures to support the business environment in the context of the Covid-19 epidemic.

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Rene Schob

Partner, Head of Tax & Legal

KPMG in Romania

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GEO no. 99/2020 thus creates the necessary legal framework to allow facilities such as:

  • Exemption from payment of the specific tax for an additional period of 90 days. 
  • The granting of the bonus for taxpayers which pay the micro-enterprises tax, and for corporate taxpayers which have opted for a modified fiscal year but also by corporate taxpayers who are also payers of the specific tax on certain activities.
  • Exemption from VAT with the right to deduct for operations involving protective masks and medical ventilators, until 1 October 2020.
  • Extension of the terms of application of the facilities granted by previous ordinances.

Specific tax measures to support the HoReCa industry

The Government has granted an exemption from payment of the specific tax, during the fiscal year 2020, for a period of 90 days, from the date of entry into force of this ordinance for taxpayers whose activities are governed by Law no. 170/2016 on the specific tax for certain activities. The 90 days of exemption are added to the period for which no specific tax is calculated due to the interruptions of activity as a result of the state of emergency, as specified in GEO no. 48/2020.

Furthermore, the deadline for declaring and paying the specific tax for the first quarter of 2020 has been extended to 25 October 2020.

Measures on bonuses for payment of corporate tax and income tax on micro-enterprises

According to the provisions of Law no. 54/2020 for the approval of GEO no. 33/2020, the 10% bonus granted to taxpayers which paid, upon maturity, the profit tax / quarterly advance payment for the first, second and third quarters of 2020, was calculated on the profit tax due.
This wording was confusing because it allowed the interpretation that these facilities apply only to corporate taxpayers.

GEO no. 99/2020 has clarified that taxpayers which pay income tax, and which also pay the specific tax on certain activities, may also benefit from the bonus for the profit tax / quarterly advance payment related to the first, second and third quarters of 2020, determined for the activities carried out, other than those corresponding to CAEN codes provided by law.

The new provisions of GEO no. 99/2020 clarify the application of the bonus by taxpayers paying micro-enterprises tax. Under the new provisions, the bonus is calculated on the quarterly due tax / quarterly advance payment.

GEO no. 99/2020 also states that taxpayers which have opted for the modified fiscal year will benefit from the bonus. Thus, the application of bonuses for the payment of income tax due / prepayment is extended for the second and third quarters, i.e. for the period 26 June - 25 September inclusive, and the period 26 September - 25 December inclusive, for 2020. Mentioning these payment periods is necessary as the amended fiscal year does not correspond to the calendar quarters of 2020.

VAT exemption

From 25 June until 1 October 2020, the following operations involving protective masks and medical ventilators will be VAT-exempt with the right to deduct:

  • Deliveries made to public institutions responsible for setting up rescEU;
  • Intra-Community imports and purchases made by these institutions.

Extension of deadlines

The following facilities previously granted will be extended to 25 October, inclusive:

  • The cancellation of interest and late payment penalties for fiscal obligations maturing after 21 March 2020, as set out in GEO no. 29/2020
  • The cancellation of interest and penalties (as set out in the Fiscal Procedure Code) for installments, which have not been paid within the established deadlines.
  • The suspension of foreclosure measures involving seizure of budget receivables, except for foreclosures which are the result of criminal proceedings as a result of court decisions. GEO no. 99/2020 also states that foreclosure procedings for the recovery of state aid (following a decision of the European Commission / state aid provider or a national court) will also be suspended;
  • The procedure for refund of VAT with the subsequent performance of the tax inspection, as provided by GEO no. 48/2020. 


 

© 2021 KPMG Tax SRL, a Romanian limited liability company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

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