Minimum tax dropped as of October 1

The minimum tax was finally dropped, yet tax consultants say that the ordinance is not really specific and has lots of flaws likely to give taxpayers and accountants a headache.

"The positive message is that the minimum tax was dropped. Yet the legislation is not well correlated, it contains a lot of unclarities and is laborious. It will give accountants a headache. There are two tax periods. The manner of calculating the taxable profit for the final quarter of the year is subject to interpretations. In addition, the regularisation mechanism is eliminated. You can be making losses and not be able to regularise," commented Emilian Duca, tax partner with BDO Conti Tax Advisors.
The Government decided to drop the minimum tax as of October 1, so that companies will pay profit tax for the last three months of the year. The final minimum tax payment date of the amounts due for the third quarter is October 25.
The minimal tax was enforced as of May 2009, and calculated in line with the turnover, so that it stood at a minimum 500 euros and a maximum of 10,000 euros per year.
It was challenged by both major companies and small entrepreneurs, as well as by analysts and tax consultants, who said it was not a good time to introduce a minimum tax given that many companies were in the red because of the economic crisis.