Ponta: Gov’t to decide in October how far to go with the fiscal relaxation on the labour market
Prime Minister Victor Ponta has made an announcement that there will be no major changes regarding the fees and taxes in 2014, following in October the government to decide how far to go with the fiscal relaxation on the labour market: either it reduces social security contributions either it increases the wage base that is not submitted to taxes.
‘There will be no major changes, the flat tax will stay at 16 percent and the VAT will be cut down in 2014 – on condition that the experiment with the lowered value added tax on bread succeeds – probably in the case of the other foodstuffs too; the excises will practical lower too, as they are calculated based on the leu-euro exchange rate from October 1, 2013, when the leu was stronger than the euro, which means that the excises will be lowered in the case of fuels and in other products; that’s why we are going to choose in October between one of the two variants: either we will cut the social security contributions either we will increase the nontaxable wage base or, in other words, that part of the wage that is not submitted to taxes, which also means that the minimum wage will be practically exempted from paying the 16 percent in taxes. These are two possible variants to be considered together with Mr. Chitoiu (Minister of Public Finances, editor’s note) and Mr. Voinea (Minister Delegate for Budget, editor’s note) from the viewpoint of their impact on the budget, following that we decide on which one to choose by the end of October’, the Prime Minister told the Antena 3 television channel.
He also added that the Agreement with the IMF (International Monetary Fund) says nothing about possible increases in fees or taxes, with the flat tax to possible come into force as of 2014 representing an initiative of he government that was taken over by Minister Delegate Maria Grapini.
‘Mrs. Minister discussed this with the representatives of the SMEs six months ago, then she came with the bill, the bill was submitted to the Parliament and, unless the Parliament decides not to adopt it, it will mean that certain types of services, hotel, restaurant, hairdressing salon, there will be no taxes to be levied […]’, said Ponta.