Government Plans Income Tax of Up To 50% on Special Pensions

The Romanian government is working on a draft to apply an income tax rate of 10% to 50% on special pensions, official sources told Mediafax.

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Pensions lower than RON2,000 would not be taxed at all, pensions of RON2,000 to RON7,000 would be taxed 10%, which is the regular income tax rate in Romania.

Pensions of RON7,000 up to RON10,000 would be taxed 30%, and pensions exceeding RON10,000 would be taxed 50%.

The new tax grid would only apply to special pensions, not pensions based on contributions, the sources added.

Finance minister Eugen Teodorovici said Wednesday the move to tax special pensions was an act of social justice and people with low pensions would not be affected.

The new tax grid on special pensions would impact around 4,000 people who receive special pensions higher than RON7,000 a month.

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