COVID-19 Countermeasures in Romania

Allowance During The Labor Contract Suspension

• Labour code allows the company, during interruption or temporary reduction of activity due to economical, technological, structural or similar reasons, to dispose labor contract suspension, unilaterally. During this period, the employee should receive an allowance, no lower than 75% of its base salary for the position he is occupying. This allowance represents a cost for the company.
• Allowance for “technical unemployment” from public funds shall be borne from the unemployment insurance budget, in accordance with the ordinance, under the following conditions:
• the employer temporarily reduces or interrupts the activity – in whole or in part – as a result of the effect of the coronavirus epidemic;
• only during the decreed state of emergency;
• in a maximum amount of 75% of the gross salary, but no more than 75% of the average gross wage provided by the Law of the state social security budget for 2020 (maximum 4.071 lei gross);
• submission of a self-declaration regarding the reduction or interruption of the activity.
• The deadline for the financial statements due on May 30, 2020 is postponed until July 31, 2020.

Measures implemented by Romanian Tax Authorities

• Suspending or not starting the foreclosure of the amounts due to the State budget. In this respect, no more payment notifications, garnishments and seizures will be issued or started, with the exception of the amounts decided by Courts in criminal matters;
• VAT refund payments will be made in March, for all processed returns for which reimbursement decisions have been issued;
• A new VAT reimbursement system will be implemented starting April 1st, 2020, which will be aimed to promptly settle the tax returns;
• Tax related audits (e.g. tax inspections, anti-fraud controls) will be suspended, with the exception of the reviews and checks that may be done remotely and the cases in which there are indications of tax evasion.
• The deadline for the tax returns due on March 25, 2020 is postponed until April 25, 2020.
• For local taxes the payment term is deferred from March 31, 2020 to June 30, 2020

Bonuses to the corporate income tax

• Corporate income taxpayers (including those applying specific taxes), regardless of their submission and payment system, who pay the tax due for the first quarter of 2020, or the advance payment for the same quarter, until the standard deadline of April 25, 2020, will benefit from a tax bonus, computed as follows:

• 5% for large taxpayers

• 10% for medium and other taxpayers

Loans suspension

• The beneficiaries of the above mentioned emergency ordinance are: natural persons, authorized natural persons, individual companies and family businesses, the persons exercising liberal professions and the ones exercising on the basis of special laws, regardless of the form of exercising the profession, as well as the legal persons – parties in the credit or leasing contracts
• The facility granted to the debtors: the obligation to pay the outstanding installments arising from the loans, representing capital ratios, interest and commissions due on the date of entry in force of legislation, is suspended on request of the debtor up to 9 months, but no later than 31.12.2020. The natural persons for whom the extension of the maturity of the loans exceeds the age limit, may benefit from the deferred payment of the installments provided the restructuring of the loans.

Utilities and rental suspension

• Small and medium-sized enterprises which disrupt the activity in whole or in part based on the decisions issued by the competent public authorities and which hold an emergency state certification shall qualify for:

• deferred payment of utilities services – electricity, natural gas, water, phone and internet services

• deferred payment of rent for the space intended for the registered headquarters or the secondary establishments

Allowance for other profesionals

• Other professionals who do not have the status of employers and disrupt the activity in whole or in part based on the decisions issued by the competent public authorities according to the law, during the state of emergency, benefit from the general budget consolidated by an allowance equal to the minimum gross basic salary in the country guaranteed in payment established for 2020.