Study: 3 out of 10 Romanians believe VAT cut on food won't reduce prices

About 95% of Romanians know about the Government’s decision to cut the VAT on food and non-alcoholic beverages from 24% to 9% starting June 1. Despite this high percentage, only a third of Romanians believe prices will drop in line with the VAT cut, according to a recent study conducted by iSense Solutions. Moreover, three out of ten Romanians think that prices will not decrease at all. 65% of respondents believe that only some retailers will reduce prices for food products while 75% expect hypermarkets and supermarkets to apply the highest cuts. “Romanians have expected this VAT cut on food for long time, a measure already successfully implemented in many European countries. However, a big part of them don’t believe that all retailers will apply this measure correctly,” said Traian Nastase, managing partner iSense Solutions. 85% of Romanians would like food products and non-alcoholic beverages to have two price tags after the law comes into force: one with the product’s old price and one with the new one. Romanians also expect TV commercials to inform the population about the new prices. “Consumers expect retailers to have a transparent communication on how the VAT cut on food is applied. 27% of them want to see commercials about prices changes,” said Andrei Canda, managing partner iSense Solutions. Romanians are even more skeptical when it comes to restaurants. Six out of ten respondents think that prices will not drop too much at restaurants, because they include food processing and services that are not included in the VAT cut project. The study, conducted online by iSense Solutions, is representative for the urban population. Romania’s Fiscal Council approves VAT cut on food with ‘reservations’ Romania strengthens control on retailers ahead of VAT cut. Irina Popescu, irina.popescu@romania-insider.com