On July 25, 2025, Law No. 141/2025 was published in the Official Gazette, whereby the Government introduced significant new fiscal and budgetary changes. These measures will impact aspects such as dividend tax, pension income, VAT rates, excise duties, and social security contributions.
Below we present the main changes affecting the business environment. In addition to these, there are a number of measures that impact certain categories of individuals, namely employees in the public sector. These are not covered in this summary.
Direct taxes and social contributions
- Increases the tax on dividends from 10% to 16%, applicable to both individuals and legal entities (effective January 1, 2026).
- An additional tax on turnover is introduced for banks: – 2% between January 1 and June 30, 2025 – 4% between July 1 and December 31, 2025 – 4% for 2026 – 2% for banks with a market share of less than 0.2%
- Interest earned by individuals on bonds issued by Romanian companies on foreign markets will be taxed at 10%.
- Gambling revenues will be taxed progressively:
– 4% for amounts up to 10,000 lei – 400 lei + 20% for the portion exceeding 10,000 lei, up to 66,750 lei – 11,750 lei + 40% for amounts exceeding 66,750 lei
Health insurance contributions (CASS)
- CASS payments are introduced for pensions exceeding 3,000 lei per month, and the calculation basis is the amount exceeding 3,000 lei. Application period: August 1, 2025 – December 31, 2027.
- Starting January 1, 2028, all pensions will be exempt from CASS.
- The contribution will be withheld and paid by pension funds or paying institutions.
- Individuals may opt to pay CASS on behalf of dependents, based on a ceiling of 6 minimum gross salaries per year.
VAT – changes to rates and rules
- The standard VAT rate increases from 19% to 21%.
- The reduced rate of 9% is replaced by 11% for: – Basic foodstuffs and beverages (with important exceptions) – Firewood and other products intended for heating – Textbooks, books, newspapers, cultural and tourist services
- The 9% VAT rate will be temporarily maintained for housing deliveries between August 1, 2025, and July 31, 2026, if all of the following conditions are met: – Usable area of less than 120 square meters – Value of less than 600,000 lei excluding VAT – Payment of a minimum 20% deposit by July 31, 2025 – The person has not purchased another home with reduced VAT since January 1, 2023
- After August 1, 2026, only the standard rate of 21% will apply to housing.
The amount of leave for temporary incapacity for work caused by common illnesses or accidents outside of work will be determined for each episode of illness, as follows:
a) by applying a percentage of 55% to the calculation basis for sick leave certificates issued for a period of up to 7 days of temporary incapacity for work;
b) by applying a percentage of 65% to the calculation basis for sick leave certificates issued for a period of between 8 and 14 days of temporary incapacity for work;
c) by applying a percentage of 75% to the calculation basis for sick leave certificates issued for a period of more than 15 days of temporary incapacity for work.
Excise duties – significant increases
- Energy products (gasoline, diesel, liquefied gas) will see a significant increase in excise duties (over 80%, comparing the current value with that planned for 2026).
- Excise duties on tobacco and alcohol products are gradually increasing: – Cigarettes: from 673 lei/1000 pieces (2024) to 718 lei/1000 pieces (2026) – Ethyl alcohol: from 4,630 lei/hl (2024) to 5,848 lei/hl (2026)
Excise duties on certain fermented products (e.g., cider, mead) will be reinstated starting in 2025.
Additional regulations
- VAT exemptions for NGO deliveries and purchases will be eliminated after August 1, 2025, with the possibility of reimbursement until October 31, 2025.
- The reporting obligations for taxpayers who pay pensions, allowances, or other types of social income are clarified.
The rules on retroactive corrections for CASS and the recalculation of contributions based on court decisions are being updated.
Entry into force and applicability
- If the bill is approved, its provisions will come into force on August 1, 2025.
- Most of the tax measures will come into force on August 1, 2025, but there are also measures that will apply from January 1, 2026.
For personalized assistance or simulations regarding the impact of these changes on your business, our team of consultants is available for any clarifications.
