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Project of voluntary increase of the minimum wage in the economy, without taxing the increase

Employers in Romania will be able to voluntarily increase the salaries of employees with the minimum wage by 200 lei, this additional amount will be exempted from the payment of tax and social contributions.

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Employers in Romania will be able to voluntarily increase the salaries of employees with the minimum wage by 200 lei, this additional amount will be exempted from the payment of tax and social contributions, according to a draft emergency ordinance issued by the Ministry of Finance.

The measure is part of the “support for Romania” program and must be approved by the Government and published in the Official Gazette.

The Ministry of Finance thus proposes non-taxation and non-inclusion in the base of calculation of mandatory social contributions of the amount of 200 lei/month, representing income from salaries and assimilated to salaries, for the voluntary increase of the minimum gross basic salary per country guaranteed in payment, provided in the individual labor contract. The Regulation of the derogating tax regime aims to “combat the negative social consequences caused by the increase in prices”.

More specifically, if this draft OUG will be approved, from June 1, 2022, for the amount resulting from the increase of the basic salary from the minimum gross basic salary per country guaranteed in payment, respectively 2.550 lei monthly, without including bonuses and other additions, at the amount of 2.750 lei per month, no income tax and mandatory social contributions are due.

This measure will also benefit newly employed persons in the period between the date of entry into force of the emergency ordinance and until 31 December 2022, including, for which the level of the gross monthly basic salary established under the individual employment contract, without including bonuses and other additions, it’s 2.750 lei.

The tax regime provided by the OUG draft applies during the period when the increased/employment salary, as the case may be, is maintained at the level of 2750 lei, for:

  • incomes from salaries and assimilated to salaries made between june 1st and December 31st, 2022, including, in proportion to the period of the month in which the employees benefited from the salary increase of 200 lei;
  • persons employed at a fixed salary level of 2750 lei (not including bonuses and other additions), in the case of newly employed persons up to 31 December 2022, inclusive.