Romania

DAC9 

Through Government Ordinance No. 1/2026, Romania transposed Directive (EU) 2025/872 (“DAC9”), which amends Directive 2011/16/EU and extends the automatic exchange of tax information between EU Member States regarding the Pillar Two top-up tax. 

Tax measures 

Pillar Two Directive

Directive (EU) 2022/2523 (‘Pillar Two Directive‘) was transposed in the Romanian legislation through Law no. 431/2023, which introduced into the Romanian legislation a complex system of rules for an effective minimum taxation of 15% for multinational enterprise (MNE) groups and large-scale domestic groups with annual consolidated revenues of at least 750 million euros (EUR) in at least two of the four previous financial years. It was published in the Official Gazette no. 8 dated 5 January 2024 and is applicable to financial years starting as of 31 December 2023. 

The Romanian Government adopted in August 2025 a Government Ordinance amending the implementation law for the Pillar Two. Key changes include the obligation for entities subject to these rules to calculate and disclose deferred tax for Pillar Two purposes in their individual financial statements, based on Romanian accounting standards, or alternatively, to opt for applying IFRS as the basis of accounting (i.e. until this change, only listed companies and financial institutions applied IFRS in Romania). The new requirements take effect from 2025 and aim to improve transparency and consistency in Pillar Two reporting, although detailed application norms are expected. 

Entry into effect of the Multilateral Instrument (MLI)

In accordance with the reservation made by Romania based on art. 35 (7) of the MLI, Romania submitted to the Organisation for Economic Co-operation and Development (OECD) secretariat on 6 March 2023 the notification regarding the fulfilment of the necessary internal procedures in order to produce effects by the MLI for the implementation within the double tax treaties (DTTs) of the base erosion and profit shifting (BEPS) measures currently with 51 out of 89 treaty partners. 

Therefore, the MLI started to produce effects for transactions taking place on or after 1 January 2024 for the withholding tax (WHT) provisions and beginning with fiscal periods on or after 1 January 2024 for the other tax provisions of the treaties.

DAC7

OUG 16/2022 introduced rules that transposed the provisions of the seventh update to Council Directive 2011/16/EU on administrative cooperation in the field of taxation into law (DAC7). 

DAC7 extends the European Union (EU) tax transparency rules to digital ’platforms‘ and introduces an obligation on ’reporting platform operators‘ to collect, verify, and report specific information with respect to ’reportable sellers‘ that have undertaken ’relevant activities‘ through their platforms. 

DAC7 also introduces new automatic exchange of information between the EU tax authorities regarding the taxable events and income generated through these platforms. 

Furthermore, DAC7 includes a legal framework to enable joint audits. In a joint audit, two or more countries join to form a single audit team to conduct a taxpayer examination. Joint audits should result in quicker issue resolution, more streamlined fact finding, and more effective compliance.

Public country-by-country (CbC) reporting

Romanian requirements for publishing the report on the information regarding the profit tax regarding the ultimate parent company (‘public CbCR‘) are governed by the Order of the Ministry of Finance no. 1802/2014 (Order 1802/2014) modified by the Orders of the Ministry of Finance no. 2048/2023 and no. 1730/2023.

Under the current law, the following entities have the obligation to publish and ensure access to a public CbCR:

• The ultimate parent companies, whose consolidated net turnover exceeded on their balance sheet date, for each of the last two consecutive financial years, the amount of 3.7 billion Romanian leu (RON), as reflected in their consolidated annual financial statements.

• The medium and large subsidiaries of MNE groups in Romania, controlled by ultimate parent companies that are not governed by the legislation of an EU Member State and that meet the reporting conditions (i.e. consolidated net turnover exceeded on their balance sheet date, for each of the last two consecutive financial years, the amount of RON 3.7 billion).
• Branches established in Romania by entities that do not fall under the legislation of an EU Member State and that meet the reporting conditions (i.e. consolidated net turnover exceeded on their balance sheet date, for each of the last two consecutive financial years, the amount of RON 3.7 billion and the ultimate parent company does not have a medium or large subsidiary in Romania).

Under the Romanian accounting law, a company is considered a medium or large subsidiary if it exceeds at least two of the following three criteria in two consecutive years:

• Total value of assets: RON 17.5 million.
• Net turnover: RON 35 million.
• Average number of employees: 50.

The legislation is effective starting 1 January 2023 and applies to financial years beginning on or after 1 January 2023. Entities that have chosen a financial year other than the calendar year are to apply these provisions from the beginning of the first financial year thus chosen, starting after 1 January 2023.

Reporting (publication) is required within 12 months of the financial year-end (i.e. 31 December 2024 for a calendar year reporting entity) and shall remain accessible for a period of at least five consecutive years.

Publishing requirements

The public CbCR should be made available to the public free of charge, in Romanian language, on the website of the:

• ultimate parent companies
• subsidiary or affiliated entity, or
• branch or entity that opened the branch,

depending on the type of reporting entity.

The subsidiaries or branches controlled by a non-EU ultimate parent, and the latter prepares a public CbCR, are exempted from the above requirements under certain conditions.

Changes of the Romanian Fiscal Code

Value added tax 

Change in the Standard VAT Rate applicable in Romania (Effective August 2025) 

In 2025, Romania introduces one of the most notable adjustments to its VAT system: the increase of the standard VAT rate from 19% to 21%, effective 1 August 2025. Most goods and services across the economy become subject to 21% VAT rate.

Reform of Reduced VAT Rates

Beginning on the same date, the previous reduced rates of 5% and 9% are abolished, replaced by a single reduced rate of 11%. This unified reduced rate applies to a limited array of products and services, including human-use medicines, water supply and sewage, food and beverages for human or animal consumption, fertilizers, pesticides, as well as physical and digital publications such as books and newspapers. 

Many items, however, transition out of the reduced VAT category and become subject to the new 21% standard rate. These include residential immovable properties and certain leisure activities. 

Expansion of the Small Business VAT Exemption Regime (From September 2025)

From 1 September 2025, Romania updates the special VAT exemption regime for small enterprises by increasing the eligibility threshold from RON 300,000 to RON 395,000. This change was introduced through Government Emergency Ordinance No. 22/2025.

EU Cross‑Border VAT Exemption for Small Enterprises

Romania further expands the flexibility of the small enterprise exemption regime by allowing Romanian taxable persons to apply the small business exemption in other EU Member States, provided that their EU‑wide turnover does not exceed EUR 100,000 and they stay within each Member State’s local thresholds (as well as vice versa).

Updated Place‑of‑Supply Rules for Virtual Events

Romania updates the VAT place‑of‑supply rules for cultural, educational, and entertainment events that occur in a virtual format. Under the new provisions, B2C services related to virtual events are taxed where the beneficiary is established, creating a clear distinction from physical events and ensuring a fair and consistent treatment within the increasingly digitalized EU services landscape.

Temporary Suspension of Obligations and Sanctions under RO e‑TVA

Throughout 2025, taxpayers benefit from temporary relief for the non-compliance with the RO e‑TVA system.  

Procedure for obtaining theVAT Deferment Certificate 

The new procedure for obtaining the VAT deferment certificate prescribes the online submission of the necessary file in a centralized customs system.   

RO e-Factura

For B2G supplies (public institutions), e‑invoicing via RO e‑Factūra has been mandatory since 2022, requiring businesses to issue structured XML invoices through the national platform.  

Electronic invoicing is mandatory in Romania for B2B transactions between Romanian taxable persons. From 1 July 2024, only invoices sent through RO e‑Factura are recognized as valid invoices for B2B taxable operations. Receiving or booking invoices outside the system is subject to penalties equal to the 15% of the value of the invoice. 

From 1 January 2025, Romania expanded the system to include B2C transactions. These should be submitted in RO e-factura portal only for reporting purposes. In other words, even though consumers do not retrieve invoices from the system (unlike B2B recipients), but still via traditional means (i.e. PDF, physical format) suppliers must still submit their invoices through RO e‑Factura. 

Foreign businesses registered for VAT in Romania are also required to submit e‑invoices for taxable supplies within Romania while still being shared with the recipient using traditional methods. 

Originally, invoices had to be transmitted within 5 working / calendar days (as the case), but amendments effective January 2026 standardized the deadline to 5 working days across both B2B and B2C transactions. 

Certain transactions remain out of scope, such as: 

• Exports 

• Intra‑Community supplies of goods 

• Certain simplified invoices that meet specific conditions 

RO e-Transport

RO e-Transport obligations have been initially implemented as of 1 July 2022 and are mandatory for certain categories classified by the authorities as high fiscal risk goods (e.g. fruits and vegetables, alcoholic/non-alcoholic beverages) that are transported on Romanian territory.

Moreover, as of 15 December 2023, RO e-Transport obligations were extended also to international road transport.

Thus, the identification of transports and the generation of the unique UIT codes in the RO e-Transport system is mandatory both for road transports on the national territory of goods with high fiscal risk and for international road transports of goods.

The obligation to report in the RO e-Transport system the data related to the international transport of goods and to obtain the UIT codes is with the following users:

• The consignee listed in the import customs declaration or the sender listed in the export customs declaration for goods that are the subject of the import or export operations, as the cases may be.
• The beneficiary in Romania in cases of intra-Community purchases of goods.
• The supplier in Romania for the intra-Community supplies of goods.
• The depositary in cases of goods that are subject to transit intra-Community transactions, both for goods unloaded on Romanian territory for storage purposes or for the arrangement of a new shipment from one or more consignments of goods, as well as for goods loaded after storage or after the arrangement of a new transport on the national territory for one or more batches of goods.

The road transport operator is required to equip the transport vehicle with telecommunication terminal devices. The driver of the means of transport is required to switch on the positioning device before starting a transport on the national territory and to keep it in operation until it arrives at the declared place of delivery on the national territory or after leaving the national territory. Failure to comply with these rules lead to application of sanctions as of 1 January 2026.  

Sanctions for non-compliance with the high fiscal risk goods apply as of 1 January 2023, while the sanctions for the new measures introduced with respect to international road transport apply as of 1 July 2024.

Law no. 296/2023

Minimum turnover tax (IMCA)

Law no. 296/2023 introduced the IMCA.

Taxpayers (other than credit institutions and oil and gas companies) that registered a turnover of over EUR 50 million in the previous year and for which the corporate income tax (CIT) is lower than the IMCA will be required to pay CIT at the level of the IMCA. The IMCA is calculated as 0.5% applied on the difference between total revenues and certain deductible elements such as non-taxable income, value of fixed assets in progress, and accounting depreciation related to new assets. In the case of a tax group, the IMCA is calculated by the responsible legal entity by summing all the group members’ turnovers.

As an exception, companies that have activities in the oil and gas sectors and that registered in the previous year a turnover of more than EUR 50 million will owe, in addition to the CIT, a specific turnover tax.

Credit institutions (i.e. Romanian legal entities and Romanian branches of credit institutions – foreign legal entities) are liable for a newly-introduced turnover tax in addition to the CIT.

Economic operators that exclusively conduct activities of distribution/supply/transport of electricity and natural gas that are regulated/licensed by the National Energy Regulatory Authority are exempt from the application of the IMCA.

IMCA will be eliminated starting with fiscal year 2027 (or the modified fiscal year beginning in 2027). Additionally, the specific turnover tax for companies operating in the oil and natural gas sectors will also be eliminated from fiscal year 2027. 

RO e-Sigiliu  

A new national system, RO e-Sigiliu, was introduced based on the use of electronic devices and an IT application that allows the relevant authorities (such as the National Fiscal Administration Agency and the Romanian Customs Authority) to determine the potential points of diversion for the road transport of goods regardless of whether they are in transit or have as their final destination an economic operator on the national territory. 

Law no. 126/2024: Measures to combat tax evasion

Law no. 126/2024 introduces greater penalties for acts that constitute tax evasion offences resulting in damages representing VAT owed to the state budget, and it criminalises new acts of tax evasion for situations in which taxpayers do not use national IT systems such as RO e-Transport, RO e-Invoice, e-fiscal registers, the electronic seal of goods, and SAF-T.

Special cases of non-punishment have been introduced for cases in which the damage caused by tax evasion does not exceed the RON equivalent of EUR 1 million.

The act of not withholding certain tax obligations at source has been criminalised and prison sentences introduced.

No additional payment obligations are due as of the date of approval of the restructuring plan for the budget obligations that form the object of the restructuring, with the exception of excise duties.

Corporate taxation

Government Ordinance (GO) no. 153/2020 provides that, during its application period (2021 - 2025), the deadline for submitting returns and paying CIT (for taxpayers applying OMF 1802/2014) is 25 June of the following year, or the twenty-fifth day of the sixth month following the end of the amended tax year. The same date applies to (i) the deadline for submitting the declaration for the fourth quarter and the payment of the tax for that quarter in the case of microenterprises and (ii) the deadline for submitting the declaration for the second half and the payment of activity-specific taxes.

Starting from 14 May 2020, expenses resulting from assignments of government securities, bonds, and other debt instruments that give the holder a contractual right to receive cash are deductible when calculating the CIT result.

On 31 January 2020, the Ordinance for implementing mandatory disclosure rules pursuant to Council Directive (EU) 2018/822 (DAC6) was published in the Official Gazette. The Romanian version of the law is closely aligned with the DAC6 Directive’s scope, hallmarks, and reporting requirements.

The provisions of ATAD II have been implemented in Romanian tax legislation. The Ordinance implementing ATAD II (published in the Official Gazette on 31 January 2020) is in line with ATAD II provisions. 

Starting with Q3 of 2018, companies may opt for quarterly distribution of profits to shareholders. Reconciliation of such amounts is performed subsequent to the approval of the annual financial statements. Those who opt for the quarterly distribution of dividends are required to prepare interim financial statements. Any differences resulting from the reconciliation are payable within 60 days of the date of approval of the annual financial statements. Failure to meet that deadline results in penalty interest being due.

Dividend tax

For dividends distributed as of 1 January 2026, the dividend tax rate has been increased from 10% to 16%.

WHT on dividends obtained by non-residents

For dividends distributed as of 1 January 2026 by a Romanian resident to a non-resident, the dividend tax rate has been increased from 10% to 16%.

Value-added tax (VAT)

Value added tax 

The standard VAT rate in force in Romania is 21%, with two reduced VAT rates of 11% applicable for certain goods and services. Also, the Romanian VAT legislation prescribes specific types of goods and services for which a VAT exemption regime can be applied (either with or without VAT deduction right). 

A Romanian entity becomes liable to register for VAT purposes upon exceeding the RON 395.000 threshold of VAT-able operations performed*. However, the VAT registration can be obtained before reaching the threshold, thus enabling the entity to exert the deduction of input VAT for acquisitions made for the intended VAT-able operations. The VAT registration code is granted pursuant to submitting a VAT registration file with the VAT registration request and various information, which can differ from one tax administration to another. The entity’s representatives might be requested to submit additional documents and/or provide clarifications to satisfy the scrutinized items.  

In case a company solely performs VAT exempt without deduction right operations, it is not liable to register for VAT purposes, but would also not be allowed to deduct input VAT on acquisitions. 

In case a company performs activities taxable / exempt with and without VAT deduction right, it is liable to request the VAT registration in case the above mentioned threshold is exceeded. In case the threshold is not exceeded, the company may opt to register for VAT purposes. As a VAT registered entity, the company may exert the VAT deduction right for its acquisitions, as follows: 

1. via direct allocation - full VAT can be deducted from the acquisitions made solely for operations with deduction right; 

1. via pro-rata mechanism - in case certain acquisitions cannot be directly allocated to either operations with / without VAT deduction right, the related VAT can be deducted based on a pro-rata computed as a ratio between the value of operations with VAT deduction right and the total value of the operations performed.