A VAT rate reduced to 5% will be possible only for the acquisition of a single home, the value of which would be between 450,000 RON and 700,000 RON, without VAT, according to a draft Emergency Ordinance published by the Finance Ministry.
"As the application of the reduced rate of VAT for the delivery of houses, according to European and national legislation in the domain, must be social in character, regulation is necessary regarding the possibility of acquiring at a reduced VAT rate of 5%, individually or together with another individual/individuals, of a single home the value of which exceeds 450,000 RON, but does not exceed 700,000, excluding VAT, representing the RON equivalent of approximately 140,000 euro. Furthermore, it is necessary to institute a control mechanism, through the introduction of a register where all home transactions that benefit from reduced rate will be inscribed, regardless of value. The registry will serve to verify the fulfillment of conditions regarding the acquisition at a reduced VAT rate of 5 pct of a single home the value of which exceeds 450,000 RON, but does not exceed 700,000, excluding VAT," the substantiation note for the draft law shows.
Furthermore, it also provides that the measure regarding the VAT rate reduction to 5% for thermal energy will be limited to the cold season - November 1 - March 31.
The reduced VAT rate for the delivery of thermal energy to the population, entering into force on January 13, 2022, was introduced through Law no. 196/2021 to amend and complete the Law regarding the public service for delivery of thermal energy no 325/2006.
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