Bucharest, November 2, 2023: Employers in three industries – construction, agri-food industry, and IT – must increase their personnel expenses by up to 18% due to the new fiscal changes that came into effect on November 1, 2023, according to an analysis by the fiscal consulting, accounting, and auditing company Crowe Romania. The new measures are immediately applicable in these sectors which together employ over 800,000 workers, which is 16% of the total number of employees in Romania. Law no. 296/2023 fundamentally changes the way in which income is taxed in several key industries, and employers have to make difficult choices in the coming days, which will affect either their budgets and profitability or employee motivation. If in construction and the agri-food industry employers must fully assume the increase in costs, in IT employers can opt to transfer the new tax into the employees' "pockets".
Who is affected? The fiscal reform brings significant changes to the labor market in three sectors of activity:
Employees from all sectors of activity will feel the impact of applying the health contribution for meal tickets and holiday vouchers, as well as other fiscal adjustments, which will influence purchasing power and general well-being. Freelancers have not escaped the new changes: the fiscal burden of authorized individuals is approaching that of employees through the new ceiling introduced for the social health insurance contribution.
Law no. 296/2023 is a turning point for Romania's economy, with still uncertain effects on economic growth and long-term stability. By restricting fiscal facilities in vital industries, the law will have a considerable impact on the labor market, the ability to attract investments, and regional economic dynamics.