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Romanian Norms For Tax On Interest Income May Be Issued This Week

Romanian applicability norms for a planned 16% tax on earnings from loan interests are likely to be published by weekend, the head of the Romanian Banks Association (ARB) said Tuesday.
Romanian Norms For Tax On Interest Income May Be Issued This Week
06 iul. 2010, 13:05, English

„We have the Finance Ministry’s promise that the norms will probably be published sometime this week,” said Radu Ghetea, ARB leader and president of Romanian state-run bank CEC.

Ghetea added the information is not official yet.

„I don’t think the tax on earnings from loan interests is going to discourage the local clients, because such a measure existed before in Romania. Moreover, is not an uncommon measure for other states either,” Ghetea told the „Mediafax talks about banking” seminar.

The Romanian authorities recently introduced a 16% tax on individual income from banking deposits, in a move to extend the general tax base and improve collection.

The new tax applies to all earnings from bank interests for deposits that mature after July 1, regardless of the opening date.

According to consultancy firm PricewaterhouseCoopers (PwC), the measure is the reverse of a tax exemption applied in 2009.

„From a banking point of view, the tax doesn’t affect lenders too much, regardless if it applies to all or only to part of the earnings. The clients are the most affected. There was an opposite norm which applied as of January 1, 2009,” said Dan Badin, tax director at PwC Romania.