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Negative opinion from CES for Tax Code changes, Government meeting postponed

de Razvan Diaconu , 6.11.2017

The Economic and Social Council, a consultative body of the Parliament and the Romanian Government, issued a negative opinion on Tudose cabinet’s draft amendment to the Tax Code, including the proposal to transfer social contributions from the employer to the employee.

The opinion is not mandatory but has only an advisory role.

In this context, the Government’s extraordinary meeting scheduled on Friday for adopting the new tax provisions has been postponed until Monday.

CES decision has been taken Tuesday and the vote was overwhelmingly against the amendments proposed by the Government, said Dumitru Coarna, a member of the CES plenum for cursdeguvernare.ro.

Economic and Social Council: “Mix” of trade unions and employers. Attributions and its relationship with Government

The Economic and Social Council is the forum authorized to issue opinions on draft legislation, which comprises leaders of trade unions, employers, and civil society. The PSD-ALDE government ignored CES in the past when decided that it must promote a certain legislation.

Last time it happened in January when Grindeanu government decided to raise the minimum national wage from RON 1,250 to RON 1,450 and amendments to the Tax Code – decisions adopted by the Government, even published in the Official Gazette without the opinion of CES. At that time, several CES members have expressed their indignation regarding the situation created.

According to the legislation in force, the Government must ask for a CES opinion seven days prior to the adoption of a piece of legislation.

The Economic and Social Council has an advisory role in establishing the economic and social policies and strategies, mitigating conflict situations at the level of an economic sector or the national level between social partners, as well as in developing, promoting and developing the social dialogue and social solidarity.

Decisions are taken in the CES plenary session, which consists of 45 members appointed by social partners:

  • 15 members appointed by the trade union confederations
  • 15 members nominated by employers
  • 15 members representing the civil society

Chronicle of a postponed meeting

The Government was supposed to gather for a special meeting on Friday at 14.00, to adopt significant changes in the Tax Code on the transfer of social contributions to employees and the establishment of a “solidarity tax” for employers.

Government’s proposals to amend the Tax Code have been criticized since their presentation by both the opposition MPs and President Klaus Iohannis as well as the tax consultants.

Amendments to the Tax Code should be discussed and approved by the Parliament by law, and decision-makers should leave their egos aside and take decisions for the national interest, regardless of the political colour,” said on Friday PSD Senator Eugen Teodorovici, Chairman of the Budget-Finance Committee, present at the “National Top Private Companies in Romania” event.

I ask the coalition to give up these measures. I recommend caution because nobody wants a policy adopted in a rush. We need a sustainable policy that will solve the problems for the future. I warn political decision-makers to have a sound judgement and not take Romania to a tax adventure with a sad ending,” President Klaus Iohannis said on Thursday.

There is no reason for the tax measures not to be adopted. I talked to various companies. They are not disturbed because of that,” PSD leader Liviu Dragnea said on Friday morning.

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