In the Official Gazette (Part I) no. 611 of 4 July 2023 was published MF Order no. 2043 amending and supplementing the annex to OMF no. 1525/2022 on the establishment of the procedure for granting tax facilities in the agricultural sector and food industry.
Thus, through the new normative act, the Ministry of Finance (MF) has made a series of amendments and additions regarding the establishment of the procedure for granting tax facilities in the agricultural sector and in the food industry.
We remind you that, according to the provisions of Law no. 227/2015 on the Tax Code, with subsequent amendments and additions, individuals who earn income from salaries and similar salaries provided for in Article 76, paragraphs (1) – (3), for the activity carried out in Romania, based on the individual employment contract, until 31 December 2028 inclusive, in the agricultural sector and in the food industry, benefit from tax facilities if the conditions provided for in Article 60, paragraph 7 of the Tax Code are cumulatively met.
Thus, the provisions of OMF no. 2043/2023 take into account the following aspects:
- revision of the regulations on the procedure for granting tax facilities in the agricultural sector and in the food industry, in order to bring them in line with the provisions of Government Order no.16/2022 approved with amendments and additions by Law 370/2022;
- clarification and completion of the existing provisions, as a result of the situations that arose in the process of application of the provisions of the OMF no.1525/2022 on the establishment of the procedure for granting tax facilities in the agricultural sector and in the food industry, including those reported by taxpayers.
Specifically, according to the new regulations, individuals, for income from salaries and similar salaries provided for in Article 76, paragraph (1)-(3) of Law no. 227/2015 on the Tax Code, with subsequent amendments and additions, hereinafter referred to as the Tax Code, for the activity carried out in Romania, based on individual employment contract, until 31 December 2028 inclusive, in the agricultural sector and in the food industry, benefit from tax facilities if the conditions provided for in Article 60, paragraph 7 of the Tax Code are cumulatively met.
The mechanism for calculating the turnover provided for in this procedure shall be applied by employers who are registered with the trade register/tax register and who actually carry out activity in the agricultural sector and in the food industry, defined by at least one of the CAEN codes provided for in Article 60, point 7, letter a) of the Tax Code.
For the purposes of Article 60, point 7 of the Tax Code, “employer” means a natural or legal person, as well as any entity without legal personality, which carries out the activities defined by at least one of the CAEN codes referred to in Article 60, point 7, letter a) of the Tax Code and cumulatively fulfils the conditions for granting tax benefits and, according to the law, may conclude individual employment contracts.”
We point out that the granting of tax relief is the responsibility of the employer/income payer.
Within the new law, there are also some changes related to the calculation of turnover.
Thus, when determining the turnover actually achieved from the activity in the agricultural sector and in the food industry according to Article 60, point 7 of the Tax Code, for the determination of income from the sale of products, including through own sales units, the income from the sale of finished products, semi-finished products, residual products and goods, which are obtained from own production, is taken into account. Income from the sale of products purchased for the purpose of resale is not taken into account, with the exception of products marketed by groups and organisations of producers in the agricultural sector, producer organisations and other forms of association in the fruit and vegetable sector, recognised by the Ministry of Agriculture and Rural Development, in accordance with Community and specific national legislation in force, as well as by agricultural cooperatives organised in accordance with the Agricultural Cooperatives Act No 566/2004, as amended and supplemented, purchased for the purpose of resale from their members.
The turnover taken into account for the application of tax facilities is the turnover achieved on the basis of a contract, order or other documents specific to the agricultural and food industry sector, from activities related to the CAEN codes referred to in Article 60, point 7, letter a) of the Fiscal Code and covers labour, materials, machinery, transport, equipment, facilities. Turnover includes the production realised and not invoiced which corresponds to the value of products in stock at the end of the reporting period, recorded in the accounts at the end of the reporting months.
The condition provided for in Article 60, point 7, letter c) of the Tax Code, regarding the gross salary, is considered fulfilled as follows:
a) in the case of individual full-time employment contracts, concluded according to the law, the gross salary for 8 working hours/day is at least 3,000 lei per month;
b) in the case of part-time employment contracts, the gross monthly income from wages and salaries is calculated at a minimum gross salary set in proportion to the gross salary for a normal working day of 8 hours/day;
c) in the case where a natural person earns income on the basis of two or more individual employment contracts, concluded in accordance with the law, in the same month, with the same employer, in order to grant tax benefits, it shall first be verified whether each individual employment contract complies with the condition laid down in Article 60, point 7, letter c) first sentence of the Tax Code, i.e. whether the gross income is calculated in compliance with the provisions of letters a) and b) of this paragraph, as the case may be. For the granting of tax facilities, the incomes related to individual employment contracts that comply with the reporting condition of 3,000 lei are cumulated. In this case, the tax benefits are granted for income from salaries and similar salaries which cumulatively do not exceed the limit provided for in Article 60, point 7, letter c) of the Tax Code. For the part that exceeds this limit , tax benefits are not granted.
In the case of gross monthly income from salaries and assimilated salaries, made on the basis of an individual employment contract, less than 3,000 lei/month, tax benefits are granted only if the condition is met that they are calculated on a gross salary at least equal to the minimum gross basic salary per country guaranteed in payment established in money, without including allowances, bonuses and other allowances, of at least 3,000 lei per month, for an average work schedule of 167,333 hours per month.
Legal basis:
– MF Order no. 2043/2023 amending and supplementing the Annex to the Order of the Minister of Finance no.1525/2022 on the establishment of the procedure for granting tax relief in the agricultural sector and the food industry;
– Fiscal Code (approved by Law no. 227/2015, published in MO no. 688 of 10.09.2015), as amended and supplemented.