The VAT increase will lead to an increase in the prices of products and services, generating a decrease in consumption and implicitly a decrease in the amounts collected from this tax, while the expected measures to increase taxation will determine a restriction of economic activity, a decrease in public revenues and an increase in unemployment, draws the attention of IMM Romania, in a press release sent to AGERPRES on Monday.
According to the organization, compared to the measures expected to be taken to increase state budget revenues, the increase in the dividend tax, from 8% to 16%, will determine entrepreneurs to avoid granting dividends in the coming period, with the projected revenues from this source likely to be greatly diminished.
Also, the increase in fuel excise duty will generate a chain increase for all products and services offered to the market, while the increase in VAT from 9% to 19% in the tourism sector will lead to a decrease in the competitiveness of an entire sector of the national economy, given the existence of contracts signed between November 2024 and March 2025 and competition from tourism from Bulgaria, Turkey and Greece, in particular.
In the view of IMM Romania, the expected measures to increase taxation will lead to a reduction in economic activity, a decrease in public revenues and an increase in unemployment.
At the same time, the VAT increase will lead to an increase in the prices of products and services, which will generate a decrease in consumption and, implicitly, a decrease in the amounts collected from this tax,
According to the budget execution, in five months, total revenues collected were 256 billion lei, up 13.6% compared to the previous year, being mainly represented by payroll and income taxes, insurance contributions, excise duties and revenues from European funds. Expressed as a share in GDP, revenues increased by 0.7%, notes IMM Romania.
Revenues came mainly from: receipts from dividend tax (+86.3% on dividends distributed in 2024, withholding the 8% tax rate), receipts from salary tax (+21.3%), above the dynamics of the salary fund in the economy (12.1%), the evolution being influenced by the elimination of tax facilities granted to employees in the construction, agricultural, food industry and computer software creation activities.
At the same time, corporate income tax amounted to 10.50 billion RON, up 4.1% year-on-year, net VAT receipts recorded 48.99 billion RON (+2.3%), excise tax revenues amounted to 18.51 billion RON (+17.1%), non-tax revenues amounted to 21.01 billion RON (+19.3%), and the amounts reimbursed by the European Union on account of payments made and donations totaled 21.98 billion RON (+32.8%).
On the expenditure side of the general consolidated budget, in the first five months of 2025, 320.23 billion RON were recorded, up 12.2% compared to the previous year.
Expenditures were mainly represented by: personnel expenses (71.07 billion RON, +11.3% compared to the same period of the previous year, respectively 3.8% of GDP, 0.2 percentage points higher compared to the same period of the previous year), interest expenses (22.86 billion RON, 6.86 billion RON higher), social assistance expenses (106.21 billion RON, +15.2%), other expenses (7.73 billion RON, representing scholarships for pupils and students, support for religious institutions, other civil compensations) and investment expenses (40.57 billion RON, +7.33%).
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