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Romania Asks EC For Derogation To Apply Reverse Taxation On Intra-EU Trade

Romania requested derogation from EU regulations to apply reverse taxation on intra-community trade with cereals, fruit, vegetables, meat, sugar and bread, and an answer on this matter is expected to be conveyed by the Council of the European Union.
Romania Asks EC For Derogation To Apply Reverse Taxation On Intra-EU Trade
06 iul. 2010, 13:01, English

Reverse taxation for cereal, fruit, vegetables, meat, sugar and bread will be applied ten days after the Council announces its approval, and only on the products for which Romania requested derogation, the Finance Ministry said in a press release.

Reverse taxation entails that transaction taxes will be paid by beneficiaries and not by entities that delivered the merchandise.

According to a Government Emergency Ordinance on fighting tax evasion, reverse taxation measures will be applied only temporarily, until December 31, 2011.

Finance Minister Sebastian Vladescu said late June that Romania quit plans to apply VAT on intra-EU trade, as well as a reverse taxation, as the European Commission warned authorities the country might put on the line the new loan installment to be disbursed by the European Union in September.

„The EU warned us that, by introducing a VAT on intra-EU trade, as well as a reverse taxation, we could endanger the new loan tranche,” said the minister, adding that the reverse taxation might be applied only based on the Council of Europe’s approval.