Romanian Govt. confirms plans to levy progressive taxation on “special” pensions only

Romania’s Government will wrap up by Monday the scheme for progressive taxation of the so-called “special pensions” namely those extended under special retirement scheme to magistrates and other top public servants, labor minister Marius Budăi said in a press conference on Friday, Hotnews.ro reported. High special pensions will be levied tax rates of up to 50% (for the incomes above RON 10,000 or EUR 2,100 per month).

A vice-president of the senior ruling party PSD, Gabriel Zetea, explained that the progressive taxation of special pensions is a social justice measure that is not aimed at obtaining additional state income.

The measure, which has been insufficiently explained so far, prompted protests, particularly from magistrates. However, the special pensions prompted even more discontent given they are disproportionately high (compared to regular pensions) and are not based on past contributions. The special pensions are paid from the state budget, as opposed to the regular pensions paid from the public pension system more or less proportional to the past contribution of the recipient.

Minister Budai claims that the reduction of the special pensions will be passed along the budget amendment this week.

The Superior Council of Magistracy (CSM) on Friday, with a unanimous vote, issued a negative review for the provisions of the draft emergency ordinance regarding the progressive taxation of the special pensions of judges and prosecutors, G4media.ro informed.

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