(P) Tax Flash: Certification of tax returns – proposed legislative amendments

(Draft Government Ordinance for the amendment of certain normative acts, published on the Ministry of Finance’s website on 20 January 2014)

Based on the draft Government Ordinance, the certification by tax consultants of the tax returns submitted by taxpayers to the tax authorities would become optional and not mandatory, as it currently is. On the other hand, the draft Government Ordinance proposes the introduction, starting 1 June 2014, of the obligation to certify the rectifying tax returns through which taxpayers correct tax liabilities related to a certain tax period, if, further to the correction, it results a positive or negative adjustment higher than 10% related to any type of tax liabilities declared through the initial tax return, but not less than RON 10,000, regardless of the rectifying tax returns’ number. The rectifying tax returns for which the certification obligation is applicable, as provided by the current draft Government Ordinance, would be accepted and registered by the tax authorities also without being certified; however, a penalty of 2% of the difference resulted from the correction of the tax liability, but no less than RON 200, would be imposed in this case. The subsequent certification would trigger the cancelation of the penalty, if performed before the commencement of the tax inspection. The tax returns’ certification would be carried out by an independent authorised tax consultant, registered as an active member with the Register of tax consultants and tax advisory companies. The certification is to be performed with/without reservations, according to certification rules approved by the Chamber of Tax Consultants, with the endorsement of the Ministry of Public Finance. Taxpayers opting for the certification of a VAT return with a negative VAT balance that is requested for refund, for which the recoverable amount applied for is between RON 20,000 and RON 65,000, will be refunded with the relevant VAT, through subsequent VAT audit procedure, provided that certain conditions are met. The draft Government Ordinance is available on the Ministry of Finance’s website at the following URL address: http://discutii.mfinante.ro/static/10/Mfp/transparenta/proiectOG_20ian2014.pdf For additional information, please contact: Venkatesh Srinivasan, Partner – Head of Tax and Legal Ernst & Young SRL and E. Platis, C. Bazilescu LLLP 15-17 Ion Mihalache Blvd. Bucharest Tower Center Building, 22nd Floor Sector 1, 011171, Bucharest, Romania Tel: (40-21) 402 4000, Fax: (40-21) 310 7124 Email: