The Cabinet on July 25 agreed a number of amendments and supplements to the legislation in connection with the fiscal reform assumed by the ruling party. The income tax rate for private individuals will be decreased from 18% to 12%, while the employers’ social insurance contribution from 23% to 18%. The annual personal exemption will double to over 24,000 lei, IPN reports.

A special fiscal regime will be instituted for the activity of hotels, restaurants and cafes by reducing the VAT 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.

Another amendment concerning the repatriation of currency is aimed at diminishing the pressure on resident exporting companies. The repatriation period will be increased from two to three years for all types of foreign contracts (money, goods, services). The delay penalty will be decreased from 0.1% to 0.05% of the repatriated  amount for each calendar day of delay.

The bill is to be submitted to Parliament for adoption. The fiscal reform is to be applied as of October 1, 2018.