Clarifications regarding recent tax amendments

The authorities recently introduced a series of tax amendments/clarifications, as follows: 

Profit tax 

• Expenses booked pursuant to transactions performed with a person resident in a state included in Annex I[1] are non-deductible if said transactions lack economic purpose

• Expenses booked pursuant to transactions performed with a person resident in a state included in Annex II[2] are deductible

Value added tax

• The threshold pertaining to the system of VAT upon collection (RON 4,500,000) is now correlated/aligned with that stated within the articles of Title VII of the Tax Code.

• Persons who exceeded the threshold of RON 2,250,000 during the month of January 2021 but were under the limit of RON 4,500,000 will not be removed from the register of taxable persons who apply the system of VAT upon collection

• The previous provisions relating to the price of real estate on which the 5% VAT rate applies (i.e. RON 450,000) remain in force

Source: Emergency Ordinance no. 13/2021 on the amendment and supplementation of Law no. 227/2015 on the Tax Code and accounting Law no. 82/1991, as published on 24 February 2021.

[1] Annex I of the EU list of non-cooperative jurisdictions for tax purposes, published in the Official Journal of the European Union

[2] Annex II of the EU list of non-cooperative jurisdictions for tax purposes, published in the Official Journal of the European Union