Moldovan authorities cannot manage taxes, foreign investors

Introducing the budgetary-fiscal policy the way that the Moldovan MPs did, is detrimental. An issue with the Moldovan authorities is that they did not learn yet or do not have the capacity to manage accumulated taxes. The statement was made for Info-Prim Neo by Dinu Armasu, executive manager of the Foreign Investor Association. This week the Parliament adopted for promulgation the budgetary-fiscal policy for 2013. Among other provision, the bill stipulate 20% VAT on sugar, compared to 8% currently, an increase in the VAT on natural and liquefied gas from 6% to 8%, and the payment of 5 days of illness leave by employees, as opposed to 1 in 2011 and 3 in 2012. Dinu Armasu believes that these increases put additional pressure on entrepreneurs and firms that activate legally and transparently, and it doesn’t affect underground activities. “Instead of collecting taxes from 100,000 entrepreneurs, they collect from 20,000. The burden becomes too heavy; the customs and fiscal inspectors’ behavior stimulates corruption. This will lead to an increase in corruption, because entrepreneurs will notice that they can solve their problems by paying bribes”, said the representative of foreign investors in Moldova. Dinu Armasu claims that people can already sense the consequences of last year’s flawed policies. “It is not a secret that the Budget accumulations have decreased; there are issues in collecting taxes, and the newly-adopted provisions strangle entrepreneurs even further. I’m afraid that this decision also overlaps with this year’s bad weather; there will be many problems, especially in the farming sector”, the association’s director stated. Dinu Armasu believes that in Moldova the issue lays within legislators’ lack of professionalism and their misunderstanding of economic processes as whole; hence, the administration's lack of concern for discussing with the business sector or the feigning of such dialogue. Meanwhile, the director of the Association of Foreign Investors that there is a gap in Moldova between what is being declared – a noble effort to pull the economy out of the underground – and the capacity to implement those policies. The authorities adopt these Laws without having the levers to enforce them, says Dinu Armasu.