PwC Says Romania’s Proposed Wealth Tax Unjustified Due To High Administration Costs

During a seminar on economic recovery, Mitroi said many European countries levying such a tax have discarded it because it cost too much to collect and track tax-liable assets. Moreover, Germany has declared its wealth tax unconstitutional, saying it is a form of expropriation.

On the other hand, the PwC partner said Romania could introduce a tax on inheritance and donations, to fight these ways of avoiding taxation.

People close to the matter told MEDIAFAX the country’s tax authority is planning to levy a tax on the assets of very wealthy people who cannot account for their wealth and who are suspected of tax evasion. The sources said the Romanian tax authority has already asked the International Monetary Fund to help it draft the required legislation.

Romania’s Finance Minister Sebastian Vladescu said recently it would be interesting to see whether some of the country’s richest gained their wealth legally.

A social democrat lawmaker proposed a draft law earlier this month introducing a wealth tax whereby households should pay an annual 0.5% on net worth of more than half a million euros.

The lawmaker said he has already been harshly criticized for his Robin Hood initiative, adding he expects further rebuke from people targeted by such a tax or rich people who have anything to hide. He said the draft law is based on the principle of transparency and would oblige everybody to submit wealth statements, not just public officials and managers in state institutions.