Through Government Emergency Ordinance (GEO) No. 78/2025, published in the Official Gazette No. 1172 of 17 December 2025, concrete measures were established for the implementation of the amendments introduced in the field of local taxes and fees by Law No. 239/2025, applicable starting with 2026. The normative act clarifies procedures, introduces sanctions, and sets strict deadlines for local public administration authorities.
Exemptions and Reductions of Local Taxes and Fees
GEO No. 78/2025 provides that decisions of local councils or of the General Council of the Municipality of Bucharest (CGMB) regarding the granting of exemptions or reductions of local taxes and fees must mandatorily include the supporting documents required for each specific situation.
Exemptions or reductions apply exclusively to taxpayers who:
- hold the supporting documents provided for in the decision;
- submit these documents to the local tax authority within the established deadline;
- have fulfilled their payment obligations for local taxes and fees for the previous fiscal year, within the legal deadlines.
Tax incentives apply starting 1 January of the fiscal year following the year in which the local council or CGMB decision was adopted.
Conditions and Limits for Granting Incentives
Local authorities may grant exemptions or reductions:
- based on cost–benefit analyses;
- for a fixed period of no more than 2 fiscal years;
- according to clearly defined criteria established by decision.
For 2026, decisions must be adopted by 31 December 2025. Upon adoption of decisions for 2027, interim evaluations of the effectiveness of the granted incentives are carried out, and continuation or termination may be decided.
The total value of exemptions and reductions may not exceed 5% of total local tax and fee revenues collected in the previous fiscal year.
Setting Tax Rates and Sanctions
The rates and levels of local taxes and fees for 2026 are established by decision of the local council or CGMB by 31 December 2025. The main credit authorizing officers are required to communicate the decision to the competent ANAF structures within 3 working days from adoption.
Failure to comply with legal obligations triggers severe sanctions, consisting of the suspension of funding to local budgets from:
- shared quotas of personal income tax;
- allocated amounts from certain state budget revenues for balancing local budgets.
Payments intended for salaries, social contributions, and financing the social protection system are exempt from suspension, in cases provided by law.
Funding of local budgets is resumed on the date when authorities provide proof of approval of the decisions regarding local taxes and fees for 2026.