The tax came into effect at the beginning of this year and has stirred plenty of interpretations and controversy amid the lack of methodological norms. The first payment term is May 26.
The Foreign Investment Council (FIC), together with Romanian Business Leaders and the Association of Business People in Romania recently warned that the introduction of the tax in its current form is set to have a strong negative impact over the business environment.
The tax is harming investments, maintains Daniel Anghel, partner at PwC audit and consulting services company and a member of FIC board.
He showed the business environment was not consulted when the decision to introduce the tax was made.
Foreign investors have shown there are industries where income is fixed and profits are low, and they also find it impossible to transfer the cost related to the tax in tariffs. In this context, the only solution for companies in these industries is to go bankrupt.
Companies in the field of energy, oil and gas extraction, mining, telecom or agriculture are set to be the hardest hit by the new tax considering the very high value of special constructions held by such companies.
However, final costs would be eventually transferred to end consumers, the population, through an increase in tariffs. The economy will suffer as some investments will remain unfulfilled.
As a matter of fact, foreign investors warned they would be forced to reconsider their investment plans on the medium and long term.
The only chance to modify the special construction tax is in Parliament.
It remains to be seen whether the final form of the document to come out of the Parliament is to include any of the suggestions made by fiscal consultants and businesspeople.
(English version by Catalina Apostoiu)