Romania's junior ruling party to amend radically planned taxation of energy companies

Romania’s junior ruling party ALDE, headed by Senate president Calin Popescu Tariceanu, came up with a series of radical amendments to the emergency ordinance (OUG) 114/2018 pertaining particularly the energy sector, Profit.ro reported.

The talks took place in the expert committee for finance-budget and economy of the Parliament’s upper chamber, which in the process of debating ordinance 114.

While this might bode well for the energy sector, severely hit by the OUG, it comes as a surprise since the Energy Ministry, which is under the supervision of Tariceanu’s party, had previously endorsed with no objections the same OUG at the end of last year.

Among the amendments promoted by the Alliance of Liberals and Democrats (ALDE), there is the abolishment of the 2% turnover tax for the energy companies and its replacement with the taxes envisaged previously for being levied in 2019 (0.2% for utilities in the energy sector and 0.1% for oil, gas and electricity producers).

Tariceanu’s ALDE also advocated for higher regulated profitability rates for the natural gas and electricity transport and supply companies. As of January 1, 2019, local energy market regulator ANRE reduced the regulated rate of return for energy distributors from 7.7% to 5.6%. ALDE wants the profitability rate set at 4.5 percentage points above the real yield of 10-year Government bonds.

Nonetheless, Tariceanu agrees with the regulated natural gas price of RON 68 (EUR 14.6) per MWh and, furthermore, wants it enforced retroactively on older but still active contracts as well.

(Photo source: Facebook/Calin Popescu Tariceanu)