Under a draft ordinance published by the Public Finance Ministry, companies in the hospitality industry will get a 90-day break on the specific tax for the tax year 2020.
The industry-specific tax was introduced by Law No. 170/2016 (the HoReCa Law) that came into force in 2017, and applies to hotel, restaurant, bar & cafe or catering activities.
The industry-specific tax is calculated according to several variables such as the rank of the facility's locality, the surface of the facility, seasonality, etc. and is paid semi-annually until the 25th of the month following the respective semester; each payment represents half of the annual due tax.
"Having in view that the specific tax on certain activities is an annual tax, and the tax statement and payment is made every six months, with the amount payable representing half of the annual specific tax, a 90-day break on the specific tax for the 2020 tax year is hereby proposed. The mechanism for recalculating the specific tax due has also been provided, as this period will be deducted from the total 365 days of the tax year. This tax break shall apply to all taxpayers under the incidence of Law No. 170/2016 on industry-specific tax, as the law provides no specific requirements for the grant of this facility," argues the substantiation note that accompanies the draft regulatory act.
The recalculated tax will be divided into two equal half-yearly payments, with the first payment due by 25 July 2020.
"The recalculation of the specific tax due will have positive effects on the cash flow starting with the first semester of 2020," said the initiators of the act.
Under the Government's Emergency Ordinance No. 48/2020 on specific financial and fiscal measures, the taxpayers who are charged a specific tax have been offered relief on the respective tax during the state of emergency, provided that certain requirements were met.
President of the Hotel Industry Federation Calin Ile estimated earlier this month that losses in the hotel industry will be near one billion euros this year.
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