Dropping the VAT for transactions paid by card could be a solution to the problem of unpaid VAT in certain areas, such as hotels, gambling, sports and entertainment activities, as well as restaurants, according to Catalin Cretu, the regional director of Visa Europe, during a press conference.

In several sectors, companies fail to pay their VAT to the state, with an 80 percent level of uncollected VAT. “introducing a fiscal facility by dropping the VAT by 3 to 5 percentage points when paid by card could bring extra money to the budget, because people will want to pay less, and will use their card,” said Cretu.

He believes the European Commission can be convinced of the benefits of such a decision. Hotels only pay 2 percent of the VAT they should pay to the state, while restaurants, 19 percent, gambling businesses, 3 percent, sports and entertainment activities, 5 percent, among others, Visa found.

editor@romania-insider.com