The economist Viorel Gîrbu believes that the intention to cancel personal exemptions for annual incomes over 360,000 lei, as announced on Tuesday by the Ministry of Finance, is a bad idea that will create inequity. In an interview with RFE/RL’s Moldovan Service, Viorel Gîrbu said the proposed measure is not being well received among the financial expert community, IPN reports.

Viorel Gârbu noted that it is very difficult to estimate the impact of the measure on the State Budget, and it’s not clear how the Minister of Finance arrived at the 360,000 lei threshold. For a person who earns 29,999 lei a month, the income after tax will be higher than for a person who earns 30,001 lei, and Gârbu says this is unfair.

Speaking about other proposed fiscal measures, including the doubling of the tax on the hospitality industry, from 10% to 20%, the expert says these are some “diffident changes made in a hurry” based on requirements from the International Monetary Fund.

The economist recalls that the previous government proposed to reduce the hospitality tax with the intention of stimulating growth in this sector. As this hasn’t happened, the current government decided to reinstate the single rate taxation without any exceptions for the hospitality industry.

According to Gârbu, what we see today is not a deep transformation of the tax system guided by some strategic goals, but rather a precipitated change made under pressure from external partners. In the near future, says the economist,  the Government should rethink these changes and fundamentally modify the tax system in Moldova.