Minister-delegate for Budget Liviu Voinea told online newspaper Gandul.info in an interview the Government is considering widening taxable income to fill in the revenue-expenses gap in the budget for 2014 and wants to set a new formula to compute excise duties.
However, he did not expand on the Cabinet’s plans for excise level calculations.
So far, Romania has been calculating excise levels in euros, using the currency exchange rate set by the European Central Bank on October 1, which this year was lower than in 2012 and lowered collections to the state budget.
The European Central Bank set a rate of RON4.4485 to the euro on October 1 this year, 1.6% lower than last year’s RON4.5223 to the euro, used for the calculation of excise duty levels in 2013.
The change in calculation methodology has to be negotiated with the International Monetary Fund, the sources said, adding it is hard to believe excises would be calculated using the estimated inflation level for 2013.
With pensions, for instance, Romanian law states they are to be indexed for inflation using the average inflation rate from two years before, as set by the National Statistics Institute. If the same rule were applied with excises, they would increase in 2014 by the average inflation rate of 2012, which stood at 3.33%.
Romania calculates excise levels in euros because the minimum level of these taxes is harmonized within the European Union.
Romania’s state budget revenues this year were considerably lower than estimated and the government will revise the budget this week and raise the deficit to 2.5% of the gross domestic product, from the previous target of 2.3% of GDP.