The fiscal landscape for 2025 is undergoing significant changes with the approval of Law no. 214 of July 31, 2024. This new law introduces several updates aimed at easing the burden on businesses and individuals while improving the tax system in line with modern needs. The most notable updates focus on VAT, excise duties, tax exemptions, and customs regulations, which are expected to have a significant impact across various sectors.
Here’s a closer look at the key measures introduced by the new law:
1. Increased Exemptions for Individuals
To alleviate the impact of inflation, the government is increasing the exemptions for individuals, providing citizens with more relief on their incomes. This move is designed to help people cope with the rising cost of living and boost their purchasing power, especially in times of economic uncertainty.
2. Raising the Deductible Ceiling for Expired Debt
Another significant update is the revision of the deductible ceiling for expired debts. Previously, the ceiling for compromised debt was 1,000 lei. With the new changes, the limit has been raised to 2,000 lei, enabling more individuals and businesses to benefit from debt relief under the new fiscal guidelines.
3. Expansion of Non-Taxable Income
The scope of non-taxable income has also been extended, which will bring benefits to many businesses and individuals. This change means more people may qualify for income that is not subject to tax, easing the financial burden on lower and middle-income earners.
4. Introduction of the Long-Term Stimulus Program
A key part of the new fiscal policies is the Long-Term Stimulus Program. This initiative introduces a Stock-option plan, allowing employees to buy or receive stock titles at a preferential price or for free. This program is designed to attract investment and encourage business growth, especially in sectors that require long-term commitment from stakeholders.
5. Expansion of Organizations Exempt from Income Tax
In a move to encourage more charitable organizations and bodies involved in public services, the law extends income tax exemptions to self-administration bodies related to professions in justice. This update allows these organizations to focus more resources on their core mission rather than worrying about tax obligations.
6. Review of VAT Incentives
One of the most discussed topics among tax professionals is the review of VAT incentives. The new law provides clarity on the VAT tax regime for services in science and innovation sectors, particularly for accredited organizations. Additionally, production workshops that employ people with disabilities in psychiatric hospitals are also included in the VAT incentives, promoting social inclusion.
7. Extension of VAT Deduction for Exceptional Situations
Another important update is the extension of VAT deductions for goods that are destroyed due to exceptional situations. The law defines “exceptional situations” in a broader context, enabling businesses to reclaim VAT on goods lost in such circumstances, which could be related to natural disasters, pandemics, or other unforeseen events.
2025 Fiscal Goals: Continuity and Progress
The new fiscal and customs policy for 2025 continues the budgetary-fiscal reforms started by the Ministry of Finance in previous years. The policy aims to foster a transparent tax environment that encourages business growth and ensures a fairer tax system for individuals.
These changes, published in the Official Gazette on August 15, 2024, mark a crucial step in modernizing the fiscal system and preparing the country for future economic challenges. The Ministry of Finance has worked closely with various stakeholders, including the European Union, to ensure that the new measures are both practical and beneficial to the broader economy.
As we move into 2025, businesses and individuals will need to familiarize themselves with these updated policies to stay compliant and take full advantage of the benefits offered. The ongoing information campaign will continue to shed light on the specifics of these changes, helping everyone navigate the evolving fiscal landscape.
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