Romanian Authorities Might Consider Taxing High Pensions Progressively – Environment Min

Borbely's statement was a reaction to President Traian Basescu's opinion that all pensions must be taxed.

The Democratic Union of Hungarian in Romania leader said that his party disagreed with taxing pensions this year, so that, following an analysis of the economic results of the austerity measures applied by the Government, a decision can be taken for next year.

Basescu said Saturday, during a visit to flood-hit areas in the northern part of the country, that the value added tax must be decreased to its previous level, adding pensions must be taxed.

The president said recently on the public radio that he hopes the Government would not resort to a new VAT hike in January 2011 without first taxing all types of income, including pensions. The head of state highlighted he does not agree with the Government's decision to raise the VAT, adding the measure was a mistake, as it does not tackle budget problems, especially those regarding wage spending and social spending, which are the state budget's "malign" spots.

The Government decided to hike the VAT from 19% to 24%, as an alternative solution to increase budget revenues, after the Constitutional Court ruled unconstitutional some provisions included in the country's first austerity plan, which had been pushed through the Parliament.

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