The 23% single tax quota will be levied on every income covered by the global income taxation system currently used, while the list of deductions was supposed to be finished yesterday, Finance minister Mihai Tanasescu said.
He explained the new regulation for levying taxes on the incomes made by individuals would be debated by the Government during its Thursday session, in case the International Monetary Fund and Romania's other international partners agreed to this.
"The point here is making procedures simpler in order to get more money for the budget. No social category will stand to lose from the enforcement of the single tax quota," Tanasescu said.
The authorities' plan to introduce this single income tax quota has been under analysis by the International Monetary Fund experts for several days now. The Fund's August mission was not informed by the authorities about this plan. IMF theoretically does not agree with such a measure, demanding guarantees that the budget would not suffer as a result. Actually, Mihai Tanasescu admitted the only obstacle for the project could be IMF's adamant opposition.
Appreciated by the business people and analysts, the introduction of the 23% single tax quota has failed to find supporters among union members. The National Union Bloc (BNS) criticised this measure, arguing it was in breach of the fiscal fairness and said it was in favour of maintaining the current progressive system.
Florin Pogonaru, chairman of the Romanian Business People Association (AOAR), however, does not feel the single tax quota promotes social unfairness in any way. " We need to encourage people to work and derive high incomes, instead of small ones," Pogonaru said.
Sorin Ionita, executive director of the Romanian Academic Society (SAR) in his turn says it is precisely the current system that promotes social equity rather theoretically.
He explains that in an attempt to get too much money from taxpayers through the overwhelming taxation categories, the current system actually stimulates them to find ways to dissimulate incomes. In addition, the wealthy and high-income people have both the means and the expertise to do it and the State is trying in vain to catch them red-handed as they will always be one step ahead. Therefore, the more complicated a taxation system is, the harder it, paradoxically, burdens the low-income taxpayers.
BNS says the new taxation system does not comply with the fiscal fairness principle, which has higher-income people pay more of their incomes as taxes, a principle turned into effect through the progressive taxation system. They feel the 23% tax quota would mainly benefit those that have high and very high-income (above 50 million ROL) salaries and those that derive significant income from various other sources, as well, while those that make less than 10 million ROL a month would lose.
miruna.lebedencu@zf.ro ; razvan.voican@zf.ro
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