(P) Tax Flash: Amendments brought to Fiscal Code

(Government Emergency Ordinance No. 8 / 2014, published in the Official Gazette No. 151 on 28 February 2014) The Ordinance brings amendments and completions to several normative acts, including the Fiscal Code and the Fiscal Procedure Code. These amendments become effective upon their publication in the Romanian Official Gazette with certain exceptions. Among the most important changes, we mention the following: Fiscal Code Corporate income tax It is specifically mentioned that the revenues obtained from the sale / disposal of shares applies held in a Romanian legal entity by a foreign legal entity are non-taxable only if there is a Double Tax Treaty is concluded between Romania and the seller’s country of residence. Withholding tax The Fiscal Code specifically mentions that in case of tax withholdings in excess of the tax rates provided by the relevant double tax treaties, respectively by the European Union legislation, the amount of tax withheld in excess shall be refunded according to the provisions of the Fiscal Procedure Code. Please refer to the Fiscal Procedure Code section of this tax alert for additional information in this respect. Income Tax Amedments were brought for the taxpayers / associations without legal personality that conduct agricultural activities for which the income is determined through income tax quotas. The ones holding agricultural production areas in different localities will choose (through the "tax return from agricultural activities through which the income is determined through income tax quotas") for determining the locality or localities from where they would like to benefit of the non-taxable income limits provided for each products group of vegetal / animal. VAT Electronic and communications services – changes applicable starting with 1 January 2015 Place of supply of services In case of telecommunication services, TV and radio broadcasting services and other services provided through electronic means to a non-taxable person, the place of supply of such services is the place where the beneficiary is established, where it has its stable domicile or residence. Special VAT regime applicable for electronic services, telecommunications and TV and radio broadcasting services The special VAT regime applicable to eletronic services supplied by taxable persons not established in the European Union (‘EU’) to non-taxable persons has been extended, being also applicable for telecommunication services, TV and radio broadcasting services. Moreover, this regime will be applicable to both taxable persons established in the EU (but in another member state than the one in which these services are used) and to taxable persons not established in the EU, as long as the conditions stipulated by this regime are observed.