Global Tax Alert | 2 August 2013

Romania issues amendments to Fiscal Code

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Romania published1 certain amendments and clarifications with respect to corporate income tax, personal income tax, microenterprises tax, withholding tax, VAT, excise duties and social contributions. This Alert covers the key provisions.

Corporate income tax


Specific regulations have been introduced regarding the deductibility of the remaining undepreciated fiscal value in the case of retirement of fixed assets used in the oil industry by the taxpayers which apply the accounting regulations in line with the International Financial Reporting Standards (IFRS) and which set accounting policies specific to the industry's activity for depreciation of these assets. The related regulations are also applicable to the remaining undepreciated fiscal value at the moment of the restatement of assets.

Permanent establishment

Tax consolidation has been introduced for foreign legal entities which have several permanent establishments in Romania (i.e., offset the taxable profits of a permanent establishment against the tax losses of another permanent establishment).

Travel allowance expenses

The travel allowance expenses granted to employees for travel in Romania and abroad are fully deductible for corporate income tax.

Limited deductibility for depreciation of vehicles

The RON 1,500 per month deduction limit for tax depreciation allowances related vehicles to will be no longer applicable to certain categories of vehicles (i.e., vehicles solely used for emergency, security and protection and courier services; vehicles used by sales and procurement agents; vehicles used for the carriage of passengers for consideration, etc).

Income tax and social charges

Allowances and any related amounts received by the foreign legal entities' employees during the delegation and secondment period in Romania are non-taxable and are not included in the taxable base of the social charges if they are granted in certain limits, as well as the amounts received for covering the travel and accommodation expenses.

Microenterprise tax

Newly set-up legal entities with a share capital of (at least) €25,000 at the moment of incorporation can opt for the profits tax system even if they fulfill the rest of the conditions regarding the microenterprise tax system.

Withholding tax

The 50% withholding tax for income paid to countries with which Romania does not have an exchange of information agreemeent in places applies only if such income is paid in connection with transactions found as artificial.

Excise duties

A maximum ceiling is brought regarding the guarantees that has to be set-up by warehousekeepers authorized for production, in accordance with the excise goods group that are to be manufactured or stored.


1. Law No 168 approving Government Decision No 8 / 2013 “Government Decision,” published in the Official Gazette No. 310 / 29 May 2013.

For additional information with respect to this Alert, please contact the following:

Ernst & Young SRL, Bucharest
  • Venkatesh Srinivasan
    +40 21 402 4004
Ernst & Young LLP, Eastern European Business Group, New York
  • Miklos Santa
    +1 212 773 1395
  • Vladimir Sopkuliak
    +1 212 773 4144

EYG no. CM3699