Romania Fin Min Says Flat Tax Up For Revision At 2011 Budget

„I believe the entire taxation system must be rethought for 2011. In my opinion, the flat tax level is open for discussions,” Vladescu told a news conference.

However, Vladescu ruled out a new increase of the value added tax rate.

Romania’s government Saturday raised the VAT level to 24% from 19%, a move aimed at compensating the annulment in court of a 15% cut in pensions and ensuring the continuity of its EUR13 billion loan agreement with the International Monetary Fund.

According to Vladescu, the Finance Ministry is currently working on a new tax on property to include basic taxation levels, particularly since Romania doesn’t have a clear evaluation system for properties.

Vladescu said low-income people are unlikely to pay a higher tax on property, but owners of several properties will have to pay extra taxes.

„The increases will target those who own many or large properties,” he said.

Vladescu added the 2011 budget will most likely be drafted in August, following discussions with IMF officials.

An IMF mission will be in Bucharest between July 20 and July 23 to assess the country’s performance under a EUR20 billion aid package which includes funds from the EU, the World Bank and other foreign lenders.