(P) Tax Flash: Tax administration of medium and large taxpayers

Order no. 3,581/2013 of National Agency for Fiscal Administration organizing the administration of large taxpayers (“The Order 3,581”) – published in Official Gazette no. 728/2013. The Order 3,581 repeals Order 2,730/2010 of National Agency for Fiscal Administration, as subsequently amended, organizing the administration of large taxpayers, and lays down the new selection criteria for qualifying a taxpayer as a large taxpayer starting with 1 January 2014. According to the Order 3,581, the first 2,500 entities selected in descending order based on the selection criteria will fall into the large taxpayers category. In the category of large taxpayers, the branches of foreign corporate taxpayers which carry out their activity in Romania can also be included. Basic criteria The new basic criteria for qualifying a taxpayer as a large taxpayer is the result of aggregating two indicators selected in the following proportions: - the volume of the owed tax liabilities declared by the taxpayer – 50%; and - the turnover reported in the financial statements as of 31 December of the year preceding the one in which the categorization is performed – 50%. The taxpayers being in temporary inactivity as per article 237 of Company Law no. 31/1990, evidenced at the Trade Registry, and those that are declared inactive as per article 781 of Government Ordinance no. 92/2003 regarding the Fiscal Procedure Code cannot be included in the large taxpayers category. Specific criteria for activity performed The non-banking financial institutions were excluded from this criteria. Order no. 3,582/2013 of National Agency for Fiscal Administration organizing the administration of medium taxpayers (“The Order 3,582”) – published in Official Gazette no. 728/2013. The Order 3,582 repeals Order 2,731/2010 of National Agency for Fiscal Administration, as subsequently amended, organizing the administration of medium taxpayers at the public finance administrations for medium taxpayers on a county level and the Bucharest General Public Finance Directorates, and lays down the new selection criteria for qualifying a taxpayer as a medium taxpayer starting 1 January 2014. Order 3,582, introduces the following two new categories of taxpayers that can be classified as medium taxpayers, if the selection criteria are fulfilled: - the branches of foreign corporate taxpayers which carry out activities in Romania; and - the nonresident taxpayers for which a medium taxpayer is its representative or fiscal representative as per title VI of the Fiscal Code. Basic criteria The new basic criteria for qualifying a taxpayer as a medium taxpayer is the result of aggregating two indicators selected in the following proportions: - the volume of the owed tax liabilities declared by the taxpayer – 50%; and - the turnover reported in the financial statements as of 31 December of the year preceding the year in which the categorization is performed – 50%. The taxpayers being in temporary inactivity as per article 237 of Company Law no. 31/1990, evidenced at the Trade Registry, and those that are declared inactive as per article 781 of Government Ordinance no. 92/2003 regarding the Fiscal Procedure Code cannot be included in the medium taxpayers category.