Taxing multinationals on profit with profit tax rates similar to those existing in the European Union and not on turnover and prohibiting the outsourcing of profits to parent companies are among the proposals to reduce the fiscal deficit that the representatives of the National Trade Union Bloc officially submitted to the National Tripartite Council for Social Dialogue, which started at 12:00.

According to a document submitted by the BNS, the trade unionists propose that VAT be maintained at the current rate or at most increase by only 1 percentage point, and that the reduced VAT rate be applied to electricity and gas bills for the population.

„It is still preferred not to carry out a real tax reform, the easy way for the Government was preferred. The proposed measures are unfair. The increase in VAT from 5 and 9% to 11%, respectively the standard VAT rate from 19 to 21%, affects everyone, but to the greatest extent those with the lowest incomes. The same applies to excise duties (especially on fuels). VAT is not among the lowest in Europe – the effective VAT rate in Romania (12.4%) places it in 8th place out of 27, before the VAT increases proposed on August 1. Germany, France, Austria, Bulgaria, etc. have rates below 21% (standard rate). The increase by 6-2-2 percentage points will most likely place Romania in the top 4 countries with the highest VAT (effective VAT rate) – after Croatia, Denmark, possibly above Hungary, with a higher effective VAT in Romania than in Poland. There are other countries that have around 21% but have reduced rates lower than those proposed in Romania: Spain (21%) also has reduced rates of 10% and 4%, Slovenia (22%), but lower reduced rates of 9.5% and 4%, Poland (23%), but reduced rates of 8% and 5%, the Netherlands (21%), but reduced rate of 9%, Lithuania (21%), but reduced rate of 9% for household utilities, Austria (20%), reduced rates of 13% and 10%. Therefore, the VAT increase by 2% percentage points appears excessive, without maximizing revenue collection measures. The problem with VAT is evasion, which is not being addressed,” the BNS document reads.

Other measures proposed by the NBS are: the transition of HORECA, housing and fertilizers to the standard VAT rate from January 1, 2026; the expenses related to salary increases in the public health sector must be assumed by the public budget in a transparent manner; CASS coverage for the unemployed and beneficiaries of guaranteed minimum income by the institutions that pay these rights, especially since the unemployment fund records an annual surplus; the introduction of extended controls targeted at areas of high tax evasion and undeclared work.

„The development of the procedure for stopping the activity of employers who use undeclared work, according to the Labor Code, this sanction cannot be applied because since 2017, when this provision was introduced, until now, the Labor Inspectorate has not developed this procedure,” the unionists point out.

Clear regulation of the concept of dependent work and ensuring identical tax treatment regardless of the type of income is another measure of the unions.

„It is unfair for an employee to pay tax and contributions on the entire salary, while in some sectors an employment contract is practiced on the minimum wage and the rest of the income as royalties, for example, in which case social contributions are paid only for the minimum wage,” they explain.

Reducing taxation on labor and reallocating the tax burden between the employee and the employer must be a priority, they say, and they propose the establishment of a working group to analyze the taxation of the labor market, as well as the effects produced by some measures adopted in the past, such as the low-wage trap generated by the deductibility of the amount of 300 RON for those who are employed with the minimum wage.

Other proposals aim at: regulating work on platforms and its correct taxation; revising the royalty system for the exploitation of concessioned natural resources, with increased attention being paid to those who grant resources but, for various reasons, delay their exploitation; reducing exaggerated incomes, given without performance criteria (to managers of autonomous regions, boards of directors, the Constitutional Court, special pensions, etc.); controlling companies that do not submit balance sheets (out of 2 million companies registered with ONRC, balance sheets are submitted to MFE for only 1.6 million).

The reduction of the compensation of tens of thousands of euros per person on the boards of directors (e.g. Exim Bank), the extension of the task of recovering the budget deficit to other professional categories (members of parliament, deputies, judges, magistrates, army, police, etc.), but also the amendment of the Procurement Law in the sense that subcontracting of parts of contracts related to the core activity is no longer allowed, thus avoiding the current situation in which large companies win tenders for works that they subcontract to private entities that work illegally are measures that are also on the list submitted by the BNS to the CNT.

AGERPRES