Romania

The standard CIT rate is 16% for Romanian companies, foreign companies operating through a permanent establishment (PE) in Romania and foreign companies that are tax resident in Romania due to place of effective management. Resident companies are taxed on their worldwide income unless a double tax treaty (DTT) stipulates otherwise. 

The CIT due for nightclubs and gambling operations is either 5% of the revenue obtained from such activities or 16% of the taxable profit, whichever is higher.

Minimum turnover tax (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 CIT is lower than the IMCA are 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.

IMCA will be eliminated starting with fiscal year 2027 (or the modified fiscal year beginning in 2027). 

As an exception, companies that have activities in the oil and gas sectors owe, in addition to the CIT, a specific turnover tax (ICAS). ICAS will also be eliminated from fiscal year 2027. 

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.

Specific turnover tax (ICAS) for oil and gas companies

Government Ordinance No. 3/2025 (GEO No. 3/2025) clarified the scope of application of ICAS for Romanian and foreign legal entities operating in the oil and natural gas industries, starting with the fiscal year 2025 or the modified fiscal year starting in 2025.

Specifically, GEO No. 3/2025 clarifies the application of ICAS for Romanian legal entities but also to non-resident legal entities performing activities in the oil and gas sector, which in an individual manner or through an association deliver goods/provides services on the Romanian. 

ICAS should be declared and paid for quarters I - IV, by the 25th day of the month following the respective quarter.

In order to avoid the risk of non-payment of ICAS, non-resident legal entities carrying out activities in the oil and gas sector, which have not registered a PE in Romania, are required to provide a guarantee letter issued by a credit institution or to make a deposit to a unit of the State Treasury in favour of the central fiscal body. The amount of the guarantee is the RON equivalent of EUR 1 million established at the exchange rate communicated by the National Bank of Romania on the date of provision of the guarantee.

ICAS will also be eliminated from fiscal year 2027. 

Micro-company tax regime

A Romanian legal entity can opt for the application of micro-company revenue tax in lieu of the standard CIT if it cumulatively meets the following conditions as of 31 December of the previous year:

• The revenues derived did not exceed the RON equivalent of EUR 100,000. Before 2026, this threshold was EUR 250,000.
• The share capital is owned by persons other than the state and administrative-territorial units.
• It is not under dissolution, followed by liquidation.
• Has at least one employ.
• Has associates/shareholders that hold, directly or indirectly, more than 25% of the value/number of participation titles or voting rights and is the only legal entity established by the associates/shareholders to apply the micro-company provisions.
• Has submitted the annual financial statements on time if it has this obligation according to the law.

The micro-company regime cannot be applied by Romanian legal entities conducting activities in banking; insurance and reinsurance of the capital market, including intermediation activities in those fields; gambling; or exploration, development, or exploitation of oil and natural gas deposits.

The tax rate on micro-company revenues is 1%.

If a micro-company derives revenues of more than EUR 100,000, then it owes CIT as of the quarter in which they exceeded those limits.

The calculation and payment of micro-company tax should be performed quarterly, by the 25th day (inclusive) of the month following the quarter for which the tax is calculated. 

The dividend income received from a subsidiary located in another Member State of the European Union can be excluded when calculating the micro-company tax, to the extent that both the micro-company and the subsidiary meet the EU Parent-Subsidiary Directive conditions. Dividend income received from a Romanian legal entity can be excluded without any conditions.

Pillar Two Directive

Directive (EU) 2022/2523 (‘Pillar Two Directive‘) was transposed in the Romanian legislation through Law no. 431/2023 starting 1 January 2024, which introduced into the Romanian legislation a complex system of rules for an effective minimum taxation of 15% for MNE groups and large-scale domestic groups with annual consolidated revenues of at least EUR 750 million in at least two of the four previous financial years.

For more detailed information and the most recent updates, please visit PwC’s Pillar Two Country Tracker.

Local income taxes

There are no county or local taxes on corporate income.