In response to the context created by the COVID-19 epidemic, two key tax measures have been adopted by the Romanian Government and enacted through GEO 29/2020:
- All tax obligations which have their due date after 21 March 2020 and which are unpaid do not qualify as overdue, and therefore they are not subject to late payment interest and penalties.
- All tax related foreclosure procedures involving garnishments are suspended by law.
- Both measures cease to produce effect 30 days from the end of the state of emergency situation, declared by the Romanian state as of 16 March 2020.
- The same ordinance provides for deferral of the payment deadline of local taxes such as taxes for buildings, land, and vehicles from 31 March 2020 to 30 June 2020, while the reduction of up to 10% for full payment granted by local councils is still applicable.
Other tax measures
- For all quarters of 2020, taxpayers who make, either by law or by option, advanced quarterly payments of corporate income tax by reference to the corporate income tax level of the previous year (2019) are allowed, by exception, to calculate, declare and pay quarterly corporate income tax at the level of the actual profit of 2020. This measure is also applicable to taxpayers with a fiscal year different from the calendar year, in 2020.
- Tax restructuring and relief measures for overdue tax obligation as at 31 December 2018 which were enacted by GO 6/2019 remain applicable if the taxpayers who want to access the measures submit notifications of intent by 31 July 2020 (the deadline before deferral was 31 March 2020) and then submit the application for restructuring measures by 30 October 2020 (the deadline before deferral was 31 July 2020).
- The deadline for filing the UBO statement has been extended to 3 months from the end of the state of emergency, as declared by Decree 195/2020.
- Throughout the duration of the state of emergency, the filing of the statement and of related documentation has been suspended.
In response to the context created by the COVID-19 epidemic, fiscal facilities have been adopted by the Romanian Government and enacted through GEO 33/2020:
- The Ordinance grants a discount to taxpayers who pay their profit tax / quarterly advance payment for the first quarter of 2020 (due on 25 April 2020) on time. Large taxpayers will benefit from a 5% discount and small and medium-sized taxpayers, as well as taxpayers which do not fall into any of these categories (for example, foundations, NGOs, private schools, etc.), will receive a 10% discount.
- Taxpayers which pay microenterprise tax will benefit from a 10% discount for the payment of the tax due for the first quarter of 2020, with the payment deadline of 25 April 2020. They will deduct from the tax due the allowance calculated according to the Ordinance.
- The requirement to pay VAT at the time of import for medicines, protective equipment, other medical devices or medical equipment and sanitary equipment needed to combat the COVID-19 pandemic has been deferred. Importers should account for the related VAT under the reverse charge mechanism. Deduction of VAT is subject to general rules provided in legislation.
In response to the context created by the COVID-19 epidemic, additional fiscal measures have been adopted by the Romanian Government and enacted through GEO 48/2020:
- Taxpayers liable to specific tax will not be liable for the tax for the period during which they interrupt their activity totally or partially during the state of emergency period.
- Micro-enterprises can also deduct sponsorship granted to public institutions and authorities from the tax due, including sponsorship of specialized bodies of public administration.
- VAT requested for reimbursement for which no decision has been issued by the date of entry into force of the Ordinance will be reimbursed to taxpayers without prior auditing. An exemption exists, however, for cases where the tax inspection has already started.
- Foreclosure procedures by notice for state receivables and subsequent recovery through tenders are suspended or will not start (unless established through court decisions in criminal matters). The suspension ends 30 days after the end of the state of emergency.
- For late payment of installments included in an installment schedule which remain outstanding within 30 days after the end of the state of emergency, no interest and penalties will be calculated according to the Fiscal Procedure Code.
- Deferral of import VAT for completely denatured ethyl alcohol used for the production of disinfectants.