Amendments related to tax amnesty

Emergency Ordinance (OUG) no.85 on the modification and completion of some normative acts in the field of taxation and customs was published in the Official Gazette, Part I no.594 of 17 June 2022.

In view of the recently published provisions, we list some of the prerequisites for the adoption of this EMERGENCY ORDINANCE:

  • due to the pandemic, economic operators are facing a lack of liquidity, which is why it is necessary to continue measures to support them in order to mitigate the negative effects on the economy;
  • the need to extend the debt restructuring mechanism for economic operators, so that the State can ensure that this mechanism enables it to recover debts at the lowest possible cost and allows economic operators to recover and maintain or even create jobs;
  • the proven usefulness of the restructuring mechanism for the settlement of budgetary obligations by economic operators;
  • the need to establish a legal framework allowing for the sanctioning of offences similar to smuggling, as the lack of regulation could adversely affect social relations;
  • the need to extend the reverse charge for certain categories of supplies of goods/services, which expires on 30 June 2022;
  • to avoid the initiation of an infringement procedure in order to ensure compliance with Article 13(3) of Directive 92/83/EEC on the harmonisation of the structures of excise duties on alcohol and alcoholic beverages, according to which Member States may set a reduced rate of excise duty for fermented beverages with an alcoholic strength by volume of less than 8.5% vol.

Amendments and additions to GOVERNMENT ORDINANCE no.6/2019 on the establishment of certain tax facilities:

According to the new regulations introduced by the URGENT ORDINANCE 85/2022, the main budgetary obligations outstanding on 31 December 2021 and not paid by the date of issuance of the tax certificate, as well as the accessory budgetary obligations can be restructured (according to the previous provisions the obligations outstanding on 31.12.2020 could be restructured).

In order to revitalize and avoid the opening of insolvency proceedings, debtors, legal entities of public or private law, except for public institutions defined according to Article 2 paragraph (1) point 30 of Law no. 500/2002 on public finances, with subsequent amendments and additions, and administrative-territorial units, in financial difficulty and for which there is a risk of insolvency, may restructure their main budgetary obligations outstanding as of 31 December 2021 and unpaid until the date of issuance of the tax certificate, as well as accessory budgetary obligations.

The main budgetary obligations outstanding on 31 December 2021 are also the budgetary obligations declared by the debtor or determined by the competent tax authority by decision after 1 January 2022 relating to tax periods up to 31 December 2021.

It should be noted that the restructuring of budgetary obligations also applies to the main and accessory budgetary obligations established by authorities other than the tax authorities, as well as to fines of any kind, submitted for recovery to the central tax authorities after 1 January 2022 until the date of issue of the tax certificate.

              According to EMERGENCY ORDINANCE 85/2022, the budgetary obligations that cannot be restructured are:

  1. a) budgetary obligations which, at the date of issuing the tax certificate, are subject to Article 167 of Law no. 207/2015 on the Tax Procedure Code, as amended and supplemented, hereinafter referred to as the Tax Procedure Code, within the limit of the amount to be reimbursed/refunded/paid from the budget;
  2. b) budgetary obligations established by administrative acts which, at the date of issuing the tax certificate, are suspended under the terms of Article 14 or 15 of the Administrative Litigation Law no. 554/2004, as amended and supplemented. If the suspension of the execution of the administrative act ceases after the date of approval of the restructuring plan and communication of the decision on relief of payment, the debtor may request the inclusion in the relief of payment of the budgetary obligations that were the subject of the suspension or the taking of other measures to restructure the budgetary obligations. To this end, the competent tax authority shall send the debtor a payment notice concerning the budget liabilities identified in administrative acts for which the suspension of enforcement has been lifted, as well as the decisions concerning the related accessory liabilities;
  3. c) the main and ancillary budgetary obligations representing state aid to be recovered, granted from state sources or resources or managed by the state, those representing European funds or national public funds related to European funds, as well as those representing customs duties, excise duties and value added tax for which the administration, with the exception of tax inspection and enforcement, is the responsibility of the Romanian Customs Authority;
  1. d) the outstanding budgetary obligations as a result of a restructuring granted under this Ordinance, for which the restructuring plan according to Article 13 paragraph (1) has failed.

We underline that the notification of the intention to restructure can be submitted until 31 January 2023. The previous deadline was 31.12.2022.

A debtor who wishes to restructure its budgetary obligations under this Chapter shall notify the competent tax authority of its intention between 8 August and 31 October 2019, between 1 February and 30 September 2020, between 1 November 2020 and 30 September 2021, and between 20 June 2022 and 31 January 2023 inclusive, under penalty of forfeiture of the right to further benefit from the restructuring of budgetary obligations, and shall apply to an independent expert for the preparation of a restructuring plan and the prudent private creditor test. Debtors who have obligations of the kind referred to in Article 1 paragraph 21 shall submit the notification within the period from 20 June 2022 to 31 January 2023 inclusive, under penalty of forfeiture and in compliance with the requirements laid down in this paragraph.

The request for restructuring may be submitted until 31 July 2023, under penalty of forfeiture. The previous deadline was 31 July 2022.

Budgetary obligations in the case of local tax authorities can also be restructured.

Debtors may restructure their budgetary obligations outstanding on 31 December 2021 and not paid by the date of issue of the tax certificate, as well as ancillary budgetary obligations existing in the records of the local tax authority, with a view to recovery, under the terms of this chapter. The procedure shall be approved by decision of the existing deliberative authorities at the level of administrative-territorial units.

In the case of debtors who have submitted requests for restructuring of budgetary obligations according to Article 5 of Government Ordinance no. 6/2019 on the establishment of tax facilities, approved by Law no. 216/2021, with subsequent amendments and additions, which are in the process of being resolved on the date of entry into force of this Emergency Ordinance, they shall be resolved in accordance with the legislation in force on the date of submission of the request or the debtors may opt, by submitting within the period provided for in Article 22 paragraph (1) of the same Ordinance a new request to the competent tax authority, for the reworking of the restructuring plan with the outstanding budgetary obligations as at 31 December 2021, under the terms of that Ordinance, as amended by this Emergency Ordinance.

The provisions of Article 8 of the GOVERNMENT ORDINANCE no. 6/2019, approved by Law no. 216/2021, as amended and supplemented, remain applicable.

In this case, based on the request, the tax authority shall issue a new tax certificate, which shall include the outstanding budgetary obligations as of 31 December 2021 and not paid at the date of its issuance.

For debtors who have submitted the notification of intention to restructure budgetary obligations, according to Article 3 of Government Ordinance no. 6/2019, approved by Law no. 216/2021, as amended and supplemented, and who have not submitted the request for restructuring of budgetary obligations, according to Article 5 of the same normative act, by the date of entry into force of this Emergency Ordinance, the tax authorities shall issue, ex officio, within 10 working days from the date of entry into force of this Emergency Ordinance, a new tax certificate containing the outstanding budgetary obligations as at 31 December 2021 and not paid on the date of issue, under the terms of the said Ordinance, as amended by this Emergency Ordinance, and shall communicate it to the debtor.

The provisions of Article 8 of Government Ordinance No. 6/2019, approved by Law No. 216/2021, as amended and supplemented, remain applicable.

The submission of a new notification, after the entry into force of this Emergency Ordinance, shall no longer produce effects. In the case where enforcement has begun, it shall be suspended from the date of submission of the restructuring request.

In the case of debtors who submit the notification on the intention to restructure budgetary obligations, according to Article 3 of the GOVERNMENT ORDINANCE no.6/2019, approved by Law no.216/2021, with subsequent amendments and additions, after the date of entry into force of this Emergency Ordinance, but do not submit the request for restructuring of budgetary obligations, according to Article 5 of the same normative act within 6 months from the date of submission of the notification, enforcement shall start or continue, as appropriate. The provisions of Article 8 of Government Ordinance No 6/2019, approved by Law No 216/2021, as amended and supplemented, remain applicable.

The submission of a new notification within the period of 6 months or after the expiry of this term shall no longer produce effects. If the restructuring request is submitted after the start of the enforcement, it is suspended from the date of submission of the restructuring request.

Legal basis:

Emergency Ordinance 85/2022 regarding the modification and completion of some normative acts in the fiscal and customs field;

Government Ordinance (GOVERNMENT ORDINANCE) 6/2019 on the establishment of fiscal facilities.