Romania’s prospective PM Ilie Bolojan says tax increases may be needed

Ilie Bolojan, interim president of the National Liberal Party (PNL) and the leading candidate to become Romania’s next prime minister, warned that tax hikes may be necessary to address the country’s worsening fiscal crisis. His remarks followed informal consultations at Cotroceni Palace on May 28, convened by president Nicușor Dan amid ongoing negotiations to form a new government.

“We are in a complicated economic situation leading to a large deficit that [this year] is approaching last year’s [8.6% of GDP in cash terms] gap. This is not sustainable,” Bolojan stated, as quoted by Hotnews.ro.

He further cautioned that if current trends continue, public debt could surpass 60% of GDP in 2025.

Ilie Bolojan acknowledged his party’s role in contributing to the fiscal imbalance, adding that the PNL is prepared to enter the future government and assume responsibility for reversing the deterioration.

“We will support a package of complex measures that do not disrupt the economy: cut public administration overhead, reduce redundant personnel, eliminate decorative positions and unnecessary expenses, decentralise, and simplify bureaucracy,” he said.

In addition to expenditure cuts, Bolojan emphasised the need to boost revenue collection. “It is possible that we will have to increase taxes and fees,” he noted, though he stressed this would be done in a way that avoids harming economic stability.

He also highlighted Romania’s slow absorption of European Union funds, which he said is hindering much-needed investments. As part of the solution, the incoming government plans to renegotiate elements of the National Recovery and Resilience Plan (PNRR) and accelerate the implementation of feasible reforms to unlock remaining EU disbursements.

President Nicusor Dan, who must nominate a new prime minister following the resignation of Marcel Ciolacu on May 5 and the collapse of the PSD-PNL-UDMR coalition, said he expects a new government to be installed within “three to four weeks.”

In the interim, the government is led by justice minister Cătălin Predoiu. The Romanian Constitution allows for a 45-day period for the appointment of a new government.

(Photo source: Inquam Photos/Malina Norocea)