A rate of 12% will be introduced on the income tax for private individuals as from October 1 this year. Currently the private individuals are taxed a rate of 7% for revenues under 33,000 lei and of 18% for revenues that exceed this sum. A bill on the reform of the salary income taxation system was adopted by Parliament in two reading, IPN reports.

The personal exemption will rise to 24,000 lei a year. For persons who became disabled as a result of the war for defending the county’s integrity and the Afghanistan war, the personal exemption will rise to up to 30,000 lei. For families with children, the personal exemption for maintained persons will rise from 2,520 lei to 3,000 lei, while in the case of maintained persons who became disabled after suffering from a congenital malformation or childhood disease to 18,000 lei. The higher exemption of 18,000 lei will be also applied in case of maintained persons with sever or accentuated disabilities.

The social insurance contribution paid by employers working in the private sector, higher education institutions and medical-sanitary institutions will be decreased from 23% to 18%, while the contribution of agriculture employers from 16% to 12%. A special fiscal regime will be instituted for the activity of hotels, restaurants and cafes by decreasing the VAT tax from 20% to 10%.

The taxi drivers with a monthly salary lower than 10,000 lei will pay a common income tax of 500 lei a month. These will be obliged to issue a receipt. If they don’t do it, the clients will have the right to refuse to pay for the trip. The period for repatriating money for sale-purchase, barter and consignation export contracts will be extended from two to three years.

Speaker of Parliament Andrian Candu noted that some will say that the fiscal reform is electoral in character, but this is actually the product of work done to identity additional financial resources for the state budget so that the government could promote this reform and improve the quality of life.