Romania prepares reverse VAT charge for more categories of products

The Romanian Ministry of Finance is preparing to introduce a reverse charge on VAT in the fruit and vegetable sector, in addition to the categories already subject to reverse VAT charge, and will have discussions with the European Commission in September on this topic, minister Alexandru Nazare told Profit.ro. Other sectors may follow, he said.

Getting EC’s permit for generalised reverse VAT charge takes years, and the new regime could not be enforced before the new VAT regulations in the European Union as of 2030, minister Nazare explained. In contrast, the special VAT charging regime in particular sectors can be enforced as soon as next year, he added.

Romania may receive an EC derogation to use this mechanism for vegetables and fruits next year, which it already applies in several areas with a high risk of VAT evasion.

The move is envisaged in the context of Romania witnessing the widest VAT gap in the European Union.

For 2022, the European Commission estimates, in its most recent report, a gap of 30.6% between the VAT that Romania could have potentially collected and the VAT actually collected (the gap was RON 41.8 billion or EUR 8 billion), down from 34.8% in 2021.

Currently, Romania is using the reverse VAT charge on some categories of goods, including cereals, electronics (mobile phones, laptops), energy delivered to energy traders, timber and wood, and green certificates.

(Photo source: Facebook/Alexandru Nazare(