Political mayhem has dominated Romania's attention after the ruling party ditched its own prime minister in June 2017, following an inter-party feud and vote of no-confidence. Sorin Grindeanu entered office as prime minister in January 2017 and held the position for less than six months.
The new Romanian government, led by Prime Minister Mihai Tudose, quickly scrapped an unpopular business tax on corporate turnover, which would have replaced a corporate tax on profit.
"The government was very quick to take a defensive position on the tax on turnover," said Alexandru Cristea, head of Țuca Zbârcea & Asociații.
"The previous government planned to introduce a specific tax on household, which was a tax on income of individuals. It was envisaged to enter into force in 2018 or earlier, however they did not have a clear plan," said Anca Grigorescu, head of tax at bpv Grigorescu Ştefănică.
The household tax proposal received significant negative criticism from Romanian businesses and was scrapped in July 2017 after the prime minister said it was "not the moment for a household tax".
Only days later, a new type of taxation on the total income and revenue of companies called a solidarity tax was also scrapped. The tax would have applied to individuals earning a higher income.
"This was a threatening development which the government promised to investigate the impact of," said Grigorescu.
Romania's businesses now desperately need some stability, both in terms of politics and taxation.
Ernst & Young S.r.l.
Bucharest Tower Center, 22nd floor
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Tel: +40 21 402 4000
Country Tax Leader
Tel: +40 21 402 4083
Law Leader, Radu si Asociatii SPRL
Tel: +40 21 402 4100
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Angela Rosca – Managing Partner
Taxhouse Taxand is, exclusively, Taxand Romania.
|Capital Gains Tax||0%||16%||A|
|Net Operating Losses (years)|
|Royalties from patents and licences||16%||C|
|Branch Remittance Tax||0%||N/A|
A) Capital gains obtained by corporate entities are included in their regular profits subject to corporate income tax at 16%; capital gains obtained by resident legal entities from disposal of Romanian entities or entities resident in a treaty-country are exempt from corporate income tax as long as two conditions are simultaneously observed: there is a minimum holding of at least 10% of the share capital of the investee, held for a minimum uninterrupted one-year period at the time of the disposal (Minimum Holding Requirements); capital gains obtained by individuals are taxed at 16% as investment income irrespective of the holding period and type of securities traded.
B) The 0% rate applies for payments qualifying under the conditions of the EU Parent-Subsidiary Directive for EU tax resident legal entities (based on inter-alia the Minimum Holding Requirements mentioned above subject to specific documentation requirements); 0% also applies to dividends paid under the Agreement between the European Community and the Swiss Confederation to Swiss tax resident parent companies holding at least 25% of the share capital of the Romanian dividend payer for a minimum two-year period at the time of dividend payment; else, as of January 1 2016, a 5% rate applies to dividends paid to all other non-residents and resident legal entities (assuming the Minimum Holding Requirements are not met, otherwise 0% applies to resident legal entities) or individuals, unless a more beneficial rate applies under a double tax treaty or a specific domestic exemption (for example, dividends paid to EU/EEA pension funds are exempt from Romanian withholding tax).
C) The 0% rate applies for payments qualifying under the EU Interest & Royalties Directive to beneficial owners being EU tax resident legal entities which are affiliated with the Romanian payer by a direct minimum holding of at least 25% maintained for two uninterrupted years at the time of payment (the exemption applies also in case both the Romanian payer and the EU qualifying beneficial owner are held by a third company which at the same time has a minimum direct holding of 25% both in the capital of the first company and in the capital of the second company for at least two uninterrupted years at the time of payment); 0% also applies to payments made under the Agreement between the European Community and the Swiss Confederation to Swiss tax resident companies qualifying under specified conditions. The domestic law increases the withholding tax rate to 50% in case of, for example, interest and royalties paid towards accounts in countries with which Romania does not have in place exchange of information mechanisms and if the said payments are made within transactions qualified as "artificial" under the Romanian tax legislation. Dividends are excluded from this treatment as of January 1 2016.
D) The seven-year period applies starting with the loss related to fiscal year 2009 (losses incurred before 2009 can only be carried forward for five years).
Baker Tilly's office in Romania deals with clients from diverse backgrounds; international, national and local. Camelia Horlaci has been the country managing partner for Romania and Moldova since January 2016.
The firm provides tax advisory and compliance services, such as VAT and other indirect taxes, corporate income tax, withholding tax, individuals and expats taxation, cross-border transactions, tax planning, structuring, restructuring, tax compliance, training and procedures. Tax review and due diligence amenities include monthly and quarterly tax review, tax review of the status of limitation period and due diligence. The practice also assists clients in their transfer pricing requirements
The practice's international connections offer its clients up-to-date insights into global developments.
Gabriel Biriş and Gelu Goran are founding partners of Biriş Goran, which comprises eight partners.
Biriş is recognised as one of the leading tax experts in Romania and has more than 20 years of experience. He specialises in tax, real estate, corporate, M&A and insolvency. He worked as secretary of state for the Romanian Ministry of Finance for nine months before he returned to Biriş Goran in October 2016.
Goran has specialised in antitrust law and M&A for more than 17 years. He is also proficient in corporate and real estate.
BPV Grigorescu Ştefănică was established in 2006. The managing partner is Anca Grigorescu. The tax team consists of three partners and six additional experts.
The group specialises in the sectors of healthcare, energy and natural resources, technology and more.
Grigorescu and associate Stefana Morarasu assisted a US company in the fast-moving consumer goods sector in a corporate tax project that was completed in May 2016. It concerned tax issues related to company activities in Romania and subsequent compliance with financial legislation. The team analysed the client's multi-level marketing system and advised on whether contractual partners were fiscally independent, among other things. This work directly impacted the client's final balance sheet total.
Deloitte's tax team in Romania comprises more than 120 tax consultants. Within the senior tax team there are three partners, six directors, 24 senior managers and managers. Dan Badin is the partner in charge of the tax and legal department. He joined the team in 2011 and previously worked at PwC. The firm has been in discussions with the authorities concerning the development of new fiscal legislation.
Badin, director Camelia Malahov, associate partner Andreea Artenie and managing associate Cristi Secrieru assisted in 2016 a Romanian client in a tax audit conducted by Romanian tax authorities, concerning corporate income tax, VAT and transfer pricing.
Other key contacts at the firm include partner Vlad Boeriu and senior consultant Silvana Balea.
Tudor Nedelea is the managing partner of DLA Piper's tax department of five professionals.
The firm provides assistance on industry-specific tax issues, as well as the national and EU regulatory related aspects of manufacturing, supply, distribution and marketing, competition related matters, R&D and intellectual property strategy.
Nedelea and tax manager Diana Nedelcu advised a subsidiary of a leading international provider of commercial vehicles in a tax dispute December 2016. The team assisted in drafting and submitting a challenge against a tax assessment decision. The initial tax valuation stated VAT incurred from acquisitions of models and equipment at the disposal of suppliers in order to produce spare parts was self-charged.
Luisiana Dobrinescu, Dumitru Dobrev and Ionuț Dobrinescu are founding partners of Dobrinescu Dobrev SCA.
The team assists clients in tax and legal advice in due diligence, dispute resolution and litigation, VAT and indirect tax, real estate, financial structuring. Clients come from the IT, road construction, food and beverages and transport industries, among others.
Alex Milcev is the head of tax and law at EY's tax department. Milcev joined the firm in 2002 and has more than 20 years of experience in tax. The tax branch consists of seven partners and 183 tax experts, working in indirect tax, corporate, disputes, compliance, accounting, people advisory services and law.
The firm assists clients within industries such as financial services, oil and gas, power and utilities, real estate, telecommunications, automotive and life sciences.
The team advised a corporation operating in the steel manufacturing industry in a tax dispute in June 2016. An annulment of the official's previous tax assessment was achieved. The cancelled assessment concerned adjustments related to transfer prices determined and used between the intra-group transactions.
The group is assisting a client from the oil and gas sector in a significant tax dispute. The client faces tax evasion accusations for allegedly failing to pay a millions in taxes. The tax team is collaborating with EY's criminal lawyer team in obtaining a significant decrease of the value of precautionary measures taken against the client.
Manuela Furdui has been the managing partner of FinExpert since 2003. Tax and accounting partner Suzana Adamache is another key contact. She joined the firm in 2011.
The team assists clients in audit, payroll and tax and offers in-depth knowledge of the Romanian market.
The team checks clients' tax statements and assists in consultancy, such as income and profit tax, VAT, withholding tax, local taxes, social contributions. It also provides assistance in tax assessment and registering companies for VAT purposes, including register of intra-community operators and tax representation for foreign companies in Romania for VAT purposes, and due diligence.
Partner Nadia Oanea leads the tax department of 11 professionals at Grant Thornton. She joined the firm in 2015 and has more than 17 years of experience in local and international taxation. As well as leading the Romanian tax practice, Oanea is also in charge of the tax team in Moldova.
Oanea and senior tax manager Ioana Sarbu assisted a Romanian group entity in March 2017. The corporate tax project concerned transfer pricing for manufacturing the business model of a group of companies within the automotive and electronic industry.
Oanea, tax manager Denisa Tenea and tax supervisor Iulian Matei advised non-resident taxpaying companies in drafting complaints. The corporations were applying for VAT reimbursement under the 2008/9/CE directive. The team assisted the clients in understanding the business model and clarifying it to the tax authorities.
KPMG is present in the Romanian cities of Bucharest, Cluj-Napoca, Constanta, Iasi and Timisoara. The head of tax and legal is partner Ramona Jurubita. Four partners, 10 directors and 190 additional tax professionals work in the tax department. Three professionals joined the firm in the past year.
Jurubita and tax consultant Daniel Pana advised a large scale holding company operating in several industries in the past year. The client was relocating its business to Romania in order to benefit from Romanian corporate law. The legal procedures related to alteration of company headquarters were undeveloped at the time the project was completed. The team corresponded with Romanian tax officials in relation to the lack of legislation and coordinated the implementation of procedures before they into entered official regulations.
Tax manager Corina David advised a large multinational company in January 2017. The team assisted in countering a tax audit and subsequent negotiation with authorities. The majority of additional taxes assessed represented temporary differences, and it was decided the principal would be recovered by the client in future periods. The final outcome of the audit was fully accepted by the client.
A client said KPMG was "customer-oriented and relevant" and provided "practical solutions (as opposed to theoretical solutions), and updated knowledge of the issues discussed".
Edwin Warmerdam is partner and head of tax advisory services at Mazars in Bucharest. He has more than 25 years of experience in finance and taxation.
Partner Vasile Andrian is the head of audit and financial advisory services. Partners Razvan Butucaru and Ella Chilea are key contacts within the practice.
The practice advises clients from diverse sectors, including real estate, construction, energy, automotive, real estate and fast moving consumer goods.
Clients benefit from the Mazars international network, which covers 79 countries.
A key contact at Muşat & Asociații is senior partner Gheorghe Muşat.
The team has extensive experience in a broad range of industries, including financial services, such as banking, equity capital markets, insurance, healthcare and pharmaceuticals, oil and gas, real estate, construction, products, industrial equipment, retail, resources, comprising chemicals, energy, natural resources, utilities, infrastructure, communications, media and technology.
Nestor Nestor Diculescu Kingston Peterson (NNDKP) is co-headed by partners Alina Timofti and Marius Ionescu. They work alongside partners Adina Vizoli, Lucian Barbu and Silviu Badescu and 15 additional professionals.
Timofti advised a local subsidiary of a leading sugar producer in March 2017. The corporate tax project was a tax audit covering five years and valuing at €21 million and related to complex profits tax and transfer pricing issues raised by the tax authorities.
A client said: "They are always proactive, very knowledgeable, to the point and indicating both risks and alternatives to the issues under discussion, in a very professional manner. NNDKP is very strong in terms of knowledge, professionalism, communication and proactivity."
Bogdan Mărculeț is the head of tax at Niculeasa Law Office, which was founded in 2012. Services within the areas of tax law include advice and representation, such as VAT regulation, income taxes, local taxes, excises tax or customs taxes.
Florentina Susnea is the managing partner of PFK Finconta. She joined the firm in 1997.
The tax department offers services within corporate tax compliance, international tax, local tax, owner-managed business, tax structuring, transfer pricing, VAT, GST, and customs and excise.
The team is experienced in assisting clients within the pharmaceutical, financials services, cultivation, cash and carry, and special constructions industries.
Floria Nitu is the managing partner of Popovici Nițu Stoica & Asociații. Nitu is recognised for his expertise in M&A in particular.
The team often assists in business tax structuring, M&A due diligence and structuring, tax structures for reorganisations, corporate and international tax planning involving Romanian and foreign entities, VAT and excise duties, customs law, post-clearance recovery of customs duties, representation in front of Romanian fiscal authorities and assistance during disputes, and litigation.
Mihaela Mitroi is managing partner of the tax and legal department at PwC in Romania. Mitroi joined the Bucharest practice in 1997. She was promoted to tax leader of South-East Europe in 2013, including Moldova, Bulgaria, Macedonia, Serbia, Montenegro, Albania, Bosnia and Herzegovina, Kosovo, Croatia and Slovenia.
The firm offers legal services, consulting and international services and indirect tax. It also offers corporate taxation services, including profit tax, witholding, dividend, local, inbound and outbound investments, M&A, corporate structuring of investments and trading activities, transfer pricing, compliance, tax reporting and strategy.
Clients benefit from PwC's international network and global insight.
Schoenherr Şi Asociații advises clients in corporate tax, international tax law, M&A, VAT, indirect tax and withholding tax. Theodor Artenie is the managing partner of the practice and is proficient in handling cross-border disputes and disputes.
Angela Rosca is managing partner of TaxHouse, Taxand Romania's tax group. The team comprises two partners and 19 experts, working in indirect tax, corporate tax, disputes compliance and accounting.
Another key individual is certified tax consultant and director Adriana Craciun, who has 12 years of experience as a tax adviser. Craciun specialises in domestic and international direct taxation, with a specific concentration on international taxation and transfer pricing.
The firm has expertise within direct and indirect taxation, domestic and international tax, transactions and M&A, transfer pricing, agency and representation, compliance, real estate, reviews and certifications, tax refunds, tailored training, tax litigation support and tax audit support.
Rosca and senior tax manager Adrian Deaconu have assisted a top Romanian food production group since 2016. The corporate tax project entailed a group restructuring involving legal entities across several jurisdictions. The team advised on alternative methods of structuring the activity.
Rosca, partner Cristian Radulescu, principal Gheorghe Enache and director Adriana Craciun have advised a Romanian subsidiary of a large global retail chain since 2016. The team assisted in a tax audit administrative appeal related to corporate tax and VAT matters, and the client saved $4 million in late payment penalties.
A client said: "Their strengths are their vocation of service, their level of knowledge, their full availability, and their professional behaviour".
A key contact at TPA Horwath in Romania is Claudia Stanciu-Stănciulescu.
The firm offers numerous services, including business model review, functional analysis, market analysis, TP model design, documentation preparation including master and local file, benchmarking studies, defence of transfer pricing in audits and advance ruling requests
Țuca Zbârcea & Asociații's tax department is managed by partner Alexandru Cristea. The team comprises two partners and 14 experts. Junior consultant Andreea Savencu joined the firm in February 2017.
Cristea, deputy manager Alexandru Manucu and senior consultant Vlad Tanase are advising a major bank in a tax dispute. The client is involved in the acquisition of banking portfolios, including loans and real estate properties, involving both Romanian and foreign entities.
Cristea and senior consultant Izabela Stoicescu advised companies involved in green energy production in October 2016. The indirect tax dispute was related to a tax audit regarding a VAT refund request in relation to a wind farm the client constructed in Romania.
|Tier 1 - Romania|
|Tier 2 - Romania|
|Taxhouse, Taxand Romania|
|Tier 3 - Romania|
|bpv Grigorescu Stefanica|
|Nestor Nestor Diculescu Kingston Peterson (NNDKP)|
|Popovici Niţu & Associaţii Tax|
|Ţuca Zbȃrcea & Associaţii|
|Tier 4 - Romania|
|Dobrinescu Dobrev SCA|
|Muşat & Associaţii|
|Niculeasa Law Offices|
|Schoenherr Şi Associaţii|