Starting August 1, 2025, the VAT rate applicable to the HoReCa industry (hotels, restaurants, cafes) will be 11%, according to the first package of fiscal measures announced by Prime Minister Ilie Bolojan. The decision is part of a broad government plan aimed at reducing the budget deficit and ensuring economic stability.
At an ad-hoc press conference held on Wednesday evening, the Prime Minister explained that the measures are designed to address two major emergencies: controlling the budget deficit and increasing the absorption of European funds.”As I presented last week, the deficit and the absorption of European funds are the two emergencies that we have to manage in the immediate future”, said Ilie Bolojan.
Under the new tax system, the current structure of three VAT rates (5%, 9%, 19%) will be simplified to two: a reduced rate of 11% and a standard rate of 21%. The 11% VAT category will include food, medicines, books, books, firewood, heating energy and services in the HoReCa industry.
Other measures in package 1, applicable from August 1, 2025:
- Increase excise duties by 10% on alcohol, fuels (with compensation mechanisms for transporters) and tobacco products;
- Expanding the CNAS taxpayer base, by imposing the CASS contribution for pensioners with pensions over 3,000 lei and eliminating some tax exceptions;
- Over-taxing profits in the banking and gambling industries.
Package 2: structural reforms and spending cuts
The second package will be unveiled at the end of July and will include deeper reforms, particularly in the area of public spending. It will cover:
- Reform of special pensions and fulfillment of the milestones set by the PNRR;
- Reform self-financed institutions (such as ASF, ANCOM and ANRE);
- Reducing subsidies, streamlining state companies’ spending;
- Reforming local public administration and reviewing unjustified bonuses;
- Updating royalties and making more efficient use of state assets.
The package will also be adopted by a show of hands in Parliament during the parliamentary recess.
Package 3: new taxes from January 1, 2026
The third package, scheduled for the beginning of 2026, foresees additional measures to increase budget revenues:
- Increase dividend tax from 10% to 16%;
- Continue to over-tax bank profits;
- Impose higher taxes on gambling winnings, with the aim of increasing state revenues by at least 30% from this source.
“We are focusing on balanced but firm measures to restore market confidence and to strengthen Romania’s economic position in the medium and long term,” the Prime Minister added.