Romania has had an economic growth model based on consumption, through lower taxes and imports, and now the bill has come due, the chief economist of the National Bank of Romania (BNR), Valentin Lazea, said on Friday, write Agerpres.
„The first message has to do with the surprise that exists in the business environment that, get this, in recent years the economy was going very well, it was humming and this year who knows what accident happened, someone, a finance minister was not careful or a budget director was not careful and in a situation that was otherwise very rosy and very good and a machine that, get this, was performing, someone made a mistake and got us in trouble. I want to say, and your study shows this, that since 2015 there has been a deliberate focus on forcing growth through consumption, through consumption higher than domestic supply, namely through imports, and year after year this has been promoted and has suited everyone. Let’s be serious! So the model of growth through consumption, by lowering taxes, by increasing imports and by deficits has been very convenient. You would have seen this last year too, if it wasn’t for the energy crisis and the resulting inflation. It would have been seen as of 2020-2021, too, if it hadn’t been for the pandemic and consumption being held back because of it. But, everyone was quiet, complacent. They told themselves that the machine is running, they didn’t see that, as Mr. Daianu (Fiscal Council’s head, ed. n.) said, it was doing so on imported gasoline. So the model was deliberately made. Growth based on consumption suited everyone and not on investments and not through exports, and now, after I don’t know how many years, the bill has finally come due,” said Valentin Lazea, at the launch event of „The Tax Institute”, the first think tank dedicated to taxation.
The chief economist of the BNR also maintained that the „change of philosophy” took place in 2015, when the Ponta government changed the Tax Code.
The Chief Economist of the National Bank of Romania attended the launch event of „The Tax Institute”, the first think tank dedicated to taxation. On this occasion, the first study conducted by The Tax Institute specialists, entitled „Amendments to the New Tax Code: Stocktaking and Impact (2015 – 2023)”.
