Deloitte: Romania is losing low taxation advantage

Romania will be able to count less on the low taxation advantage in order to attract investments and needs other strengths as 8 EU countries have reduced their corporate tax rates since 2017, according to a Deloitte analysis. The Romanian corporate tax rate remains among the lowest in the EU, ranking on the sixth position. However, Romania’s neighbors such as Hungary and Bulgaria have significantly lower rates, 9% and 10% respectively. “The decisions to lower the corporate tax rates in 2017-2018 made almost simultaneously by eight member states represent a substantial change of approach. Until last year, the vast majority of EU countries have treated tax cuts cautiously. The trend is expected to continue in the upcoming years given the official statements of some EU countries, such as France, Poland or Belgium,” said Dan Badin, Partner-in-Charge, Deloitte Romania Tax and Legal Services. “In this context, it becomes obvious that Romania will be able to count less on the low taxation as a major stimulus to attract investors and will need to focus on other business-friendly policies such as legislative predictability and stability, red tape cutting, infrastructure development, and workforce training,” he added. The member states with the lowest corporate tax rates are: Hungary (9%), Bulgaria (10%), Ireland (12.5%), Cyprus (12.5%), Lithuania (15%), Poland (15%, but only for small businesses) and Romania (16%). France, Germany and Belgium have the largest taxes for companies. Romania goes up in financial complexity index editor@romania-insider.com