Sources: "The fiscal measures proposed by the Government did not convince the officials of the EC"

European Commission officials were not convinced by the measures presented at the beginning of this week by Government representatives in Brussels, which are intended to reduce the budget deficit, according to Hotnews and G4Media sources.

The Minister of Finance, Marcel Boloş, said on Digi 24 on Tuesday that he asked the European Commission to accept a deficit target of 5.5% of GDP, above the target assumed in the budget law, of 4.4% of GDP.

According to G4Media information, the directors of the Commission, who do not have decision-making power, but technically substantiate the decisions taken by the college of commissioners, suggested in the discussions with Boloş that the money needed for the budget can be collected by increasing the VAT by two percentage points, from 19 % to 21%. Another measure suggested by the Commission was to increase the tax on dividends from 8% to 10% (this year the tax increased from 5% to 8%). Also, the officials of the European Commission requested more decisive measures to reduce the state's expenses, which have grown strongly in recent years, writes G4Media.

Government sources told Libertatea that representatives of the European Commission also insist that the pension reform be carried out faster. Meanwhile, at the level of the Executive in our country, the new law on unitary wages is being discussed, a promise that was made to several trade union confederations and which is a milestone in the PNRR. Also, the representatives of the European Commission insisted on a decrease in the number of SMEs, considering that they represent real "tax havens". A proposal was also discussed for SMEs to be below the threshold of 50,000 euros, according to Libertatea sources.

"To implement the PNRR, with all the components of the tax reform, means the introduction of progressive taxation and the reduction of VAT rates from three to one. Food for Romanians would mean that it becomes more expensive by 10%, which I don't think is possible to discuss today", said Marcel Boloş for Libertatea.

Tomorrow, Prime Minister Marcel Ciolacu will meet with the President of the European Commission, Ursula von der Leyen, to discuss the fiscal and budgetary measures through which the Government wants to reduce the deficit and the budget deficit target for 2023.

According to some Hotnews sources, there are "positive signals" that those from the European Commission will accept the increase in the deficit if they have proof of Romania's expenses with the aid given to Ukraine.

The execution of the general consolidated budget in the first seven months of 2023 ended with a deficit of 38.6 billion lei, respectively 2.43% of GDP, compared to the deficit of 26.7 billion lei, respectively 1.89% of GDP related to premiums seven months of 2022. In July, the deficit also increased compared to the previous month, when it stood at 2.34%.

This year, our country must fall within a budget deficit of 4.4% of GDP, according to the commitment made in the PNRR (National Recovery and Resilience Program).