Romanian Govt Rejects Local Tax Hike Propositions

Romania will hold local and general elections next year.

Earlier Tuesday, Ialomitianu said he will present the Government with two propositions made by local authorities, namely to increase annual local taxes by up to 50% or eliminate the current 20% increase cap and raise local taxes depending on contributors' purchasing power.

The current Tax Code states that local authorities may raise local taxes by up to 20% yearly, except taxes on vehicles.

This spring, the Government planned to allow local authorities to raise local taxes depending on local needs and contributors' purchasing power, by introducing a system setting taxes on property taking into account the property's market value.

The measure was included in the Government's draft fiscal strategy for 2012-2014, obtained by MEDIAFAX, with a view to increasing local authorities' autonomy and power of decision in matters of financial resources.

The provision was eliminated from the final document approved by the Government.

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