Romania aims to boost foreign tourism by canceling VAT on visits

Romania's Government wants to turn tourism into a more attractive business for travel agencies that bring foreign visitors to the country. Cristian Petrescu, Romania’s new Minister of Regional Development and Tourism, recently said that he will make a proposal to the Ministry of Finance to cut the VAT paid by travel agencies for bringing foreign tourists to Romania to zero, according to Mediafax newswire.

“Such a measure would be good for the tourism operators, who in turn would lower prices, making Romania a more attractive destination. Once the prices are lower, the number of tourists would increase, and I think that the earnings brought by these tourists would compensate for the VAT reduction,” said Cristian Petrescu, quoted by Mediafax. The VAT on the incoming services is currently 9 percent for hotels and 24 percent for travel agencies. The number of foreign arrivals went up by 12.6 percent during the first nine months of 2011, over the same period in 2010. Most foreign visitors came from Germany, Italy, France, UK, and US, according to the National Association of Travel Agencies in Romania (ANAT). Irina Popescu, irina.popescu@romania-insider.com (photo source: Photoxpress.com)