Romania is planning to VAT rate reduction …again

The Romanian government plans standard VAT rate reduction from 20% to 19%.

30 November, 2016


This is a continuation of the reduction introduced this year, when the VAT rate was reduced from 24% to 19%. It means Romania has gone from 24% to 19% in only 13 months.

These plans may be challenged given the higher than expected government deficit and the upcoming elections in the country. In case there is a change in the government, the VAT rate decrease is likely to be postponed.

VAT rates have been generally increased across Europe since the start of the economic downturn in 2008. Countries used Value Added Tax as one of their sources of revenue to meet their budget requirements.  However, certain countries recently published plans to decrease VAT rates as economic forecasts improve. Croatia plans a reduction of its VAT rate in 2017 and Hungary announced recently a reduction of its VAT rate in restaurant supplies.


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