Prime Minister Ilie Bolojan announced on Wednesday the fiscal package aimed at reducing the budget deficit, for which the Government will assume responsibility next week.

The measures include:

• pensions and salaries in the public sector will remain capped in 2026
• VAT will be reset to two rates, 11% and 21%, and excise duties on alcoholic beverages and fuels will be increased. Medicines, food, public services, water and sewerage, irrigation water, books, firewood and thermal energy will remain at the reduced rate. In the HORECA industry, the proposal is to remain at this level for the time being. Another measure is to increase excise duties by 10% on alcoholic beverages and fuel. Excise duty on cigarettes will also increase
• the application of the health insurance contribution (CASS) to pensions over 3,000 RON
• an increase in the teaching load by two hours in pre-university and university education
• merit scholarships will be awarded in limited numbers, and social scholarships will be awarded based on criteria.

The package presented by the prime minister will be made public on Thursday.

„We intend to conduct the necessary public consultations by the end of this week and, by Tuesday at the latest, next week, when we have the meeting of European Union finance ministers, the ECOFIN Council, to have this package adopted, and we intend to put it into practice by the Government assuming responsibility during the coming week,” announced the head of the Government.

He explained that if these measures were not taken, there would be a risk of Romania defaulting on its payments.

„If we did nothing or delayed these measures for too long, there would be several consequences that would mean the Romanian state would default on its payments. Our creditors, those who are currently lending us money and whom we will need in the future because we cannot function otherwise, would not lend us money and we would not be able to cover the state’s expenses, including salaries and pensions. Access to European funds is conditional on fiscal reform, so we would no longer have access to European funds. (…) Out of every 100 RON collected from citizens in taxes, Romania spent about 132 RON, so 32 RON more, which it obviously borrowed. Please think about how long a family that spends 30% more than it earns each month could survive, and extrapolate this situation to the level of a country to understand the situation Romania is in,” explained Prime Minister Ilie Bolojan at a press conference at Victoria Palace of Government.

AGERPRES