The tax-exempt amount for the minimum wage is decreasing, but the gross cap is increasing

The Romanian labor market is entering a new phase of tax recalibration starting in the summer of 2026. The tax relief that allowed a portion of the minimum wage to be tax-exempt will change as of July 1, 2026: the tax-exempt amount will decrease from 300 lei to 200 lei for the period July 1–December 31, 2026. The measure comes alongside a provision intended to mitigate its impact: the maximum gross income threshold up to which this exemption applies will increase from 4,300 lei to 4,600 lei. These provisions are set forth in Article 3 of Government Emergency Ordinance No. 89 of December 23, 2025.

What exactly does this measure entail?

The new regulation revises this benefit in two ways:

• Reduction of the benefit: The tax-exempt amount is effectively reduced by 100 lei (from 300 to 200 lei). This means that a larger portion of the salary is now included in the tax base, which will result in a decrease in net pay of approximately 43–45 lei for employees.
• Adjustment of the gross income cap: To ensure that an employee does not completely lose the tax exemption if they receive small bonuses, overtime pay, or other allowances, the cap on gross income has been raised to 4,600 lei (up from the previous threshold of 4,300 lei). Meal vouchers and vacation vouchers are not included in this cap.

Who is eligible for the 200 lei tax-free allowance?

To qualify for this tax exemption, all of the following conditions must be met:

1. The base salary specified in the individual employment contract must be set at the level of the national minimum gross wage guaranteed for payment (excluding bonuses).
2. The employee must be full-time (this benefit does not apply to part-time contracts).
3. The contract in question must be declared as the employee’s primary position.
4. The total gross income for that month (base salary + any bonuses or allowances) must not exceed 4,600 lei.
   Note: If, in a given month, the employee works overtime or receives a bonus that brings their gross income to 4,601 lei (even if it is just 1 leu over the cap), the benefit is lost entirely for that month, and taxes will be calculated on the full amount. This can lead to the paradoxical situation where a small bonus leaves the employee with less money in hand.

How does this change affect your wallet?

To fully understand the pricing mechanism, we need to assess the cumulative impact. A direct comparative analysis shows us how the amounts received by the employee change in relation to the company’s total financial outlay.

Starting in July 2026, although gross pay will increase by 275 lei, only 125 lei will actually end up “in your pocket,” with the remaining 159 lei going to the government in the form of taxes.