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FinMin: Government cannot reduce VAT, but plans to reduce workforce taxes

The Government cannot reduce the VAT, because it ensures most of the public expenses, but the Romanian authorities will talk to the IMF and the European Commission about the possibility of reducing the workforce taxes, Public Finances Minister Gheorghe Ialomitianu on Thursday told a press conference, organized by the Foreign Investors Council (FIC).

'In 2010 we registered a surplus in the VAT collections amounting to approximately 5 billion lei [1 euro= 4.2 lei], and in 2011 we shall register a 34 percent increase in the VAT collections compared with the previous year. The Government cannot reduce the VAT, because from it we finance most of the public expenses,' Gheorghe Ialomitianu underlined, adding that a more significant amount than before would be allocated to investments.

The Public Finances Minister encouraged the foreign investors, reiterating that 'the Government was seriously taking into account the reduction of social expenditure, and the decision would be made together with the IMF and the European Commission,' but he reassured them of 'the stability of the flat tax.'

Romania is capable to relaunch its economy on the grounds of the increase in exports, of 'the two times increase in foreign investments' and of the industrial output growth, said the Public Finances Minister. Among the elements contributing to the Romanian economy revival, the Finances Minister enumerated the 9.3 percent increase in the incomes in economy compared with last year, but also the 22-25 percent reduction in the workforce expenses.

Gheorghe Ialomitianu made an appeal to banks 'to show more courage' and to grant credits to the companies that began to receive orders, but did not have the necessary funds to start working.

At the end of his intervention, Gheorghe Ialomitianu said that he 'did not understand why the opposition wanted to block long-term investment projects,' stressing that 'it was not fair to have only short-term investments.'

Sursa: http://www.actmedia.eu

Tags: public workforce reduce government cannot euro

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