New VAT ups budget collections by 25 percent in the first month

Collections to the state budget increased by 25 percent in the first month after the introduction of the new VAT rate, compared to the average of the previous months, said prime minister Emil Boc, quoted by Mediafax.

“Increasing the VAT from 19 to 24 percent meant a 26 percent increase, collections are now 25 percent higher than the average of the previous months, so we are sort of on schedule,” said Boc.

At the first budget adjustment this year, approved in mid August, the government estimated that collections to the consolidated budget went down by RON 3.4 billion, and expenses by RON 714 million. The largest drops were estimated in collections from revenue taxes, excises and profit taxes.

In the first seven months of the year, the general consolidated budget registered a deficit of RON 20 billion, the equivalent of 3.9 percent of the GDP, after going up in July by almost RON 2 billion.

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