EU Takes Next Step In Infringement Procedure Against Romania’s Car Tax Regime

If Romania fails to comply, the Commission may refer it to the European Court of Justice. The Commission feels the tax applied by Romania discriminates against second-hand cars brought into the Romanian territory from other member states.

Romanian authorities on Tuesday sent the European Commission a letter stating the amendments to the car registration tax will become effective before July 1, 2008.

The letter does not include the concrete amendments brought to the car tax, only an implementation agenda, mentioning, at the same time, that Romanian authorities intend to study the various methods of taxation in countries such as Hungary, Finland or Spain, official sources told MEDIAFAX.

At the same time, the document restates Romania’s determination to find a favorable solution to the car tax policy and that the country would like to avoid being referred to the European Court of Justice.

There have been many talks and exchanges of letters, on the topic of the Romanian car tax, between representatives of Romanian authorities and community experts, and the Ministry of Economy and Finance sent to the Commission, late May, a new formula for the calculation of the car tax, which mentions levels up to three times lower for older cars, but higher for new ones.

Romanian economy and finance minister Varujan Vosganian said in a press conference that the Government did not consider the option of cancelling the car tax, but it would analyze the option of changing it.

The car tax was introduced early 2007, when excises paid for the import and acquisition of cars on the internal market were removed. The tax is calculated depending on the capacity of the engine, gas emission standards and the age of the car.