Romania's Main Opp Party Wants Higher Flat Tax On High Income, Higher VAT For Certain Products

Ponta also stressed that his party firmly opposes the measures recently proposed by President Traian Basescu, which target to reduce budget spending in the public sector.

"Social democrats will oppose these measures (cuts in public salaries and pension, e.n.) through all parliamentary and extra-parliamentary means," said Ponta, stressing the measures proposed by the head of state are unjust, unbearable and will prove ineffective.

"We don't think these measures will solve problems. Social democrats will not support the measures proposed by Traian Basescu and will come up with realistic and correct proposals", Ponta said.

Ponta said he informed the IMF experts that his party is in favor of a differentiated taxation system, namely an increase in the flat tax, currently set at 16%, for high-income people, and a lower flat tax for low-income social categories. He also said his party wants an increase in the value added tax, currently set at 19%, for certain products and a decrease in the value added tax for basic products.

Basescu said Thursday, after talks with International Monetary Fund officials, that pensions will decrease by 15% and salary funds in the public sector by 25%, which will also impact the minimum wage, adding subsidies will be drastically reduced.

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