The 2017-2020 convergence program approved Friday by the Government includes the measure of introducing a split VAT payment mechanism as of 1 July.
The Minister of Finance Viorel Stefan (photo) explained this initiative to cursdeguvernare.ro, ensuring that this change is in line with the European directives and will not affect the business environment.
The Minister of Finance said on Monday that he was inspired by the legislation of other EU member states when he proposed the introduction of a split VAT payment mechanism.
Italian model applied in Romania: what it is
„Italy has tested this mechanism for 2 years, which it applied for public procurement.
Basically, when purchasing goods or services, the beneficiary would pay VAT directly to the VAT account that the supplier opened at the tax authority.
The spectacular results that Italians obtained have been recently presented at an OECD meeting in Paris: they estimated an extra EUR 1 billion collected, but they received additional EUR 2.5 billion annually. Here is how life proves that it is more efficient for the state to make calculations with the money in its own pocket … „, explains Minister Viorel Stefan.
The Minister of Finance says that in Romania, the VAT split payment pilot project, which he hopes to launch on 1 July, will include the public institutions (administration) and, most likely, the state-owned companies that use public procurements. „Everything that involves public procurement contracts” was the expression used by the Minister of Finance.
„We are not violating any European directive, we are counting on the fact that there will not be drained anything, anymore, at least from the VAT collected for the contracts with the public institutions,” says Viorel Stefan.
Following the 2-year pilot project, the Italian authorities have decided to implement a second phase, which will include economic sectors with a high risk of VAT fraud, such as the construction sector. Minister Viorel Stefan says that the project will be more flexible in Romania.
„After 1 July, we intend to make progress assessments, to see the first results, based on which we shall build a strategy, also analyse new sectors of risk that we could gradually add to the program,” states Viorel Stefan.
VAT reimbursement procedure in this project
The Minister of Finance has ensured that the Government „will not change anything in the VAT reimbursement procedures.”
Companies supplying goods or services under public procurement contracts would submit their regular periodic declarations to ANAF if they had to recover VAT. „The reimbursement will be applied without any audit by the tax authority if companies do not represent any tax evasion risk. If there is a certain company that represents a risk, there will be an audit of the VAT returns,” says the Minister of Finance.
Minister Viorel Stefan assured that the state would not „stall” when it comes to VAT reimbursements and ANAF will be in the position to solve the reimbursement requests or the thematic audits effectively.
„Statistically, today we are in line with the previous interval in terms of VAT reimbursements. I have especially looked into it, asked for updated figures. We are talking figures, today we are in line,” Minister Viorel Stefan answered the question about the arrears that the state apparently registers in the VAT payment.
