Instalments on the payment of debts for companies with tax obligations that have not been paid after the emergency state

Romania’s business environment is concerned about 25 October 2020, when the deadline for companies to pay the deferred taxes in the state of emergency/alarm expires.

There are still sectors of the economy that have not fully recovered, so the Ministry of Finance, after various discussions with the business community, decided to set up a new mechanism for payment installments to avoid a stalemate in the economy, but also because the crisis lasted longer than expected in the spring, that is, the economy is not yet showing signs of recovery.

The Ministry of Finance, Florin Citu, said they are working on an emergency ordinance to regulate the payment of budgetary obligations in a simplified form for a period of 12 months for cumulative ones from the date of entry into a state of emergency until 25 October 2020 included.

According to information made public by representatives of the Ministry of Finance, companies will benefit from a simplified procedure for the payment of debts accumulated during the crisis, under certain conditions:

• the debtor did not accrue tax obligations before entering the state of emergency (so they were good payers before entering the state of emergency);
• companies benefiting from rescheduling debts to the state budget will have to pay all taxes that will be incurred after payment of installments;
• companies receiving 12-month installments should be excluded from any insolvency proceedings.

What is the procedure?

• The simplified procedure will involve the submission of an application, with an attached schedule of installments, with equal or unequal installments, depending on the way in which each taxpayer thinks;
• Applications for installment payments may be submitted by 15 December, inclusive, for all budgetary obligations from 16 March to the date of application;
• The installment will be granted within a maximum of five days, following a request to which the proposed program is attached, without the need to provide guarantees.

It is also good that simplified payment installments can be made without the granting of guarantees.

In the case of companies that are or will be subject to tax control, any additional payment amounts will also be included in the schedule of installments, the source said.

Last but not least, from government sources, there are two other measures in place:

• for HORECA operators a proposal for exemption from the payment of specific taxes until 31 December 2020;
• The extension of the measure that allowed local authorities to take decisions to reduce the tax on buildings up to 50% and to reduce the tax on buildings, rented space and also the discount public domain occupancy tax is 100%.

However, these measures are currently being proposed and we are waiting for them to be translated into legislation.