Greater Romania Party Mulls No-Confidence Motion Against Govt

Gheorghe Funar, secretary general of Greater Romania Party (PRM), Friday warned Prime Minister Calin Popescu Tariceanu that, if he opposes the VAT cut for basic food, PRM will then submit the first no-confidence motion against the current government.

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Funar stressed it is simply outrageous that the government has not been capable in the last three years to improve Romanians’ living standard.

Funar said the VAT cut for basic food would only enable Romania to align to EU standards. Tu support his statement, Funar referred to Great Britain with “zero” VAT for basic food, Poland with a 3% VAT, Spain and Italy with 4% each, as well as the Czech Republic and Germania- 5% each.

Romania’s Senate on Wednesday approved a 5% cut of the VAT for basic food – bread, meat, milk, vegetal oil and sugar.

Following Senate’s approval, Tariceanu stressed that the VAT cut would have “zero” economic impact, as traders cannot be talked into lowering food prices for more than several months.

Romania’s economy and finance Varujan Vosganian Wednesday said his ministry is to present in parliament a series of corrective measures if deputies adopt the decision cutting by 5% the value added tax for basic food.

He said that lower VAT for food is not a good idea at the moment, but will be benefic once the country’s inflation tension grows weaker and the inflation reaches 3% of gross domestic product.

He reaffirmed VAT reduction for certain products, such as basic food, will be possible after 2010, when the responsibility of tax reduction might be correlated with consumer protection measures.

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