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Romania

Government and institution measures in response to COVID-19.

Government and institution measures in response to COVID-19.

Return to homepage  |  Last updated: 14 May, 2020

General Information

An ordinance (no. 33 / 2020) provides incentives—a discount—for on-time payments of corporate income tax or the tax on the income of micro-enterprises that are due on 25 April 2020 for the first quarter of 2020 as a response to the coronavirus (COVID-19) epidemic.

In addition, a requirement to pay value added tax (VAT) on certain imports of goods that are needed to combat the COVID-19 pandemic is postponed, and importers will apply the reverse-charge system.

Tax measures – Direct and Indirect

(e.g. payment deferrals, rate reductions…)

Click here to see a comprehensive summary of jurisdictional tax measures and government reliefs in response to COVID-19.

Economic stimulus measures

(e.g. loans, moratorium on debt repayments…)

  • Raising the ceiling for credit guarantees for SMEs affected by the coronavirus crisis by LEI 5 billion, which depending on the financing needs of SMEs, can be increased even further to LEI 15 billion. Interest is 100% subsidized. The guarantee will cover 90% of loan amounts of up to LEI 1 million and 50% for credits of over LEI 1 million.
  • Same for Start-ups

Employment-related measures

(e.g. state compensation schemes, training…)

Public funding

  • Covering 75% of the salary of employees sent into technical unemployment by companies affected by the coronavirus crisis if their activity is interrupted, totally or partially or is reduced as a result of the effects of the COVID-19 pandemic for the duration of the state of emergency, based on a solemn declaration of the employer.

Social protection measures

  • The criteria for sending employees into technical unemployment and minimum income ensured for freelancers working in industries where activity is reduced or interrupted due to the pandemic.
  • The conditions for granting free paid days to parents, in order to supervise their children during the temporary closure of educational establishments.
  • The online submission of the documentation needed in order to gain access to social benefits.
  • The measures for ensuring continuity in the granting of return to work incentives and child care allowance, as well as for facilitating access to medical leave and medical leave indemnities for quarantined persons.
  • The employees which have at least one active employment agreement will not beneficiate of the allowance for technical unemployment. if one employee has more employment contracts and all these are suspended, they will beneficiate of the allowance for the most favorable salary.

Specific aspects regarding the technical unemployment regulated under the specific legislation issued by the Romanian legislative authorities in the context of COVID-19 pandemic:

  • The technical unemployment under the conditions regulated by the special legislation is to be applicable only during the state of emergency period, as decreed by the Romanian competent authorities.

Work-time reduction

  • The employers shall initiate the prior consultation of the representative trade union or of the employees’ representatives, as the case may be, with respect to reduction of the working schedule from 5 to 4 days/week – their consent is not mandatory, but they have to be consulted;
  • Decision of the employer regarding the working-time and salary rights reduction of the employees
  • Registration with REVISAL of employees’ working program and salary amendment under the legal terms (i.e. one working day prior to the amendment), under the penalty of administrative sanctions that may be applied by the competent labor authorities.

Social protection measures

  • During the state of emergency, benefits in kind are exempt from income tax and social contributions for employees who are considered essential for the business and who are in preventive isolation at the workplace or in specially dedicated areas where no outside access is granted, for a period determined by the employer.
  • Allowances for technical unemployment and days off granted to parents are not exempt from income tax and contributions, regardless of who they are granted to, if they are paid for from the state budget.
  • Start-ups: Same Public funding covering applies

Customs Measures

Duty relief

  • Exemption from Customs duties for certain products constituted as medical emergency stocks by the Emergency Department within the Ministry of Internal Affairs.

Payment facilities

  • Deferment for import VAT only for the goods intended to prevent and combat the spread of coronavirus COVID-1
  • Fiscal obligations due from 21.03.2020 and not paid within 30 days following the termination of the state of emergency will not be considered outstanding fiscal obligations. Consequently, the deadline for the payment of such “deferred” obligations is postponed to 16.05.2020 (16.04.2020 (end of emergency state) + 30 days). Even though technically this provision covers also customs duties, VAT and excise duties, at this moment there is no possibility to by-pass the payment of this taxes at the moment of importation and consequently to benefit from the aforementioned legal provision.

Contact us

Tax: René Schob – rschob@kpmg.com
Restructuring: Speranta Munteanu – smunteanu@kpmg.com
Legal: Laura Toncescu – ltoncescu@kpmg.com