Romania Plans to Cut Taxes From 2016 to Boost Economic Growth

Romania plans to start cutting taxes from next year to boost economic growth and increase living standards after four years of austerity, Prime Minister Victor Ponta said.The cabinet intends to cut value-added tax to 20 percent from 24 percent and reduce the levy for meat, fish, vegetables and fruit to 9 percent, Finance Minister Darius Valcov said. The changes will reduce budget revenue by 5.2 billion lei ($1.3 billion) next year, while it may help boost economic growth by one percentage point and help create 145,000 new jobs. Ponta’s cabinet also plans to scrap a tax on dividends from next year to make the Bucharest Stock Exchange more attractive to investors and stimulate initial public offerings, Valcov said. Lawmakers may also consider cutting a flat tax that applies to personal income and company earnings from 2019, to 14 percent from 16 percent. The country’s economy expanded 2.6 percent in the fourth quarter from a year earlier, compared with 3.3 percent in the July-September period. Expansion slowed less than economists expected as the government used a budget surplus in October to boost public spending in the last two months of 2014. Source: bloomberg.comTags: ,