Moldova

Value-added tax (VAT)

The standard VAT rate in Moldova is currently 20%. It is generally applied to local supplies of goods and services, as well as to import of goods and services through a reverse-charge mechanism.

Apart from the above, certain types of supplies are subject to reduced VAT rates. For instance, local supplies of bread and bakery products; milk and dairy products; transport and distribution of natural gases services; biofuels used for electricity, heating, and hot water production; and specific phytotechnical, horticultural, and zootechnical products are subject to the reduced 8% VAT rate.

The VAT rate for hotels, restaurants, and cafes decreased from 12% to 8% as of 10 August 2023.

As of 1 October 2021, during the national state of emergency, as declared by Parliament in accordance with the provisions of Law no. 212/2004 on the state of emergency, siege and war regime, and during the national public health state of emergency, as declared by the extraordinary national commission of public health, the VAT rate for above-mentioned activities was set at 6%.

Starting 15 April 2022, the e-book production and/or audio and electronic periodicals publications and/or audio, as well as editing services, services regarding copyright, and related rights, are VAT-exempted supply without deduction right.

The reverse-charge mechanism applies for supply of goods by insolvent economic operators. Thus, buyers are required to calculate and pay to the state budget the related VAT amounts on purchased goods.

The reverse-charge mechanism for VAT on imports of services has been implemented, so VAT payers are not required to pay VAT on such imports. The VAT amounts related to these transactions will be reflected as output VAT, and input VAT will be allowed for deduction. Non-VAT payers will be required to declare and pay VAT on the import of services.

Foreign supplies of digital services to Moldova-based individuals (B2C transactions) are taxed with a 20% VAT in Moldova. Subject to VAT are the non-resident companies performing business activity without having legal presence in Moldova:

• that supply specific digital services and obtain income from Moldovan resident individuals who do not perform business activity, or
• through which Moldovan resident individuals who do not perform business activity pay for specific digital services received from other non-residents, which place of supply is considered Moldova.

A number of supplies are VAT-exempt with deduction right, including international transportation and exports of goods or services. Certain supplies are VAT-exempt without deduction right.

Input VAT

Input VAT incurred on acquisitions of goods and/or services may be deducted, provided it is incurred by a VAT-registered payer to perform VATable supplies within its business activity.

If input VAT relates to acquisitions destined to perform mixed supplies (i.e. both VATable and VAT-exempt ones), the input VAT deduction right is allowed on a pro-rata basis.

For cases where the monthly ratio determined between the exempted supplies without deduction right and total supplies is lower than 0.05, the VAT amount paid or to be paid related to mixed procurements is fully allowed for deduction. VAT amounts previously reflected as costs or expenses in the previous tax periods for mixed procurements are deducted in the last tax period if the annual pro rata ratio is lower than 0.05.

Starting 22 November 2023, taxpayers have the right to deduct the amount of VAT paid or to be paid on acquisitions, provided that they have available the tax receipt issued by the cash register and control equipment connected to the Automated Informational System ’Electronic Sales Monitoring‘ for purchases whose value on each receipt does not exceed MDL 2,000, including VAT, but not more than MDL 10,000 for a tax period, provided that they are paid by business payment card.

VAT refunds

Should a company register a deductible input VAT exceeding its output VAT, this balance can be partially refunded only if the company carries out a specific range of business activities (e.g. export supplies, international transportation services, production of bakery and dairy products, leasing activity). Otherwise, such VAT amount may be carried forward to the following months, offset against the company's future output VAT liabilities.

Additionally, VAT payers performing capital investments in Moldova may be entitled to refund the recoverable VAT related to these kinds of capital investments, provided such assets are used for product manufacturing, service supply, and execution of works.

Companies registered as VAT payers that register the transactions via the Automated Informational System (AIS) and/or issue tax receipts via cash machines with Electronic Sales Monitoring (ESM) have the right to refund VAT on purchased goods and services. The refund will be made for the excess amount of VAT on purchases (including VAT on imports) over the amount of VAT on supplies for transactions registered as of 1 January 2023.

The possibility to offset the VAT amounts allowed for refund against future obligations to the national public budget is also available, at the request of taxpayers not having debts to the national public budget.

VAT administration

A company is required to register for VAT purposes if the total turnover within the last 12 consecutive months reached the threshold of MDL 1.2 million. Also, companies can follow voluntary registration for VAT purposes if they only intend to perform taxable supplies.

If the subject was previously registered as a VAT payer, the period of holding the status of VAT payer is not considered when assessing the registration threshold.

All VAT payers registered for VAT purposes must submit electronic tax returns. VAT liabilities must be declared and settled monthly no later than the 25th day of the month following the reporting one.

Non-resident legal entities providing services through electronic networks to Moldovan resident individuals or through which payment for services is made are required to follow a simplified registration procedure within the electronic system of the State Tax Service. Subsequently, they are required to calculate, report, and pay the related VAT amounts by the 25th day of the month following each quarter.

Generally, taxpayers are required to issue VAT invoices for the performed supplies, as well as to keep detailed records of their acquisitions and supplies in the correspondent VAT ledgers, according to a set of specific rules.

Starting 1 January 2021, the taxpayers performing supplies within public acquisitions are required to issue electronic tax invoices (except for the supplies of electricity, heat, natural gas, electronic communications services, and utilities).

Starting 1 May 2022, a taxable subject must provide to the buyer an electronic tax invoice for VATable supply of main petrol products (i.e. gasoline, diesel) on Moldova territory.

In the case of deliveries of goods paid for using business payment cards, when using e-invoices, the deadline for the supplier to issue a tax invoice is the tenth calendar day of the month following that in which the delivery took place.

Customs duties

Moldova’s current customs framework is regulated by the Customs Code, Law on Customs Tariff, International Agreements concluded by Moldova to date, and by other legal acts.

The new Custom Code entered into force 1 January 2024.

Customs duties include customs procedural taxes, customs taxes, VAT, and excise duties. In general, any kind of goods and means of transport may enter and leave the territory of Moldova without any restriction. However, certain limitations specifically provided by the legislation are in force, which cover goods and means of transport crossing the border by breaching state security, public order, environment, etc.

Customs regimes

Definitive and suspensive customs regimes are provided under Moldovan law.

Definitive customs regimes refer to import and export, while suspensive customs regimes comprise transit, bonded warehouse, inward processing relief (with suspension), processing under customs control, temporary admission, and outward processing relief.

Customs valuation

Under Moldovan customs legislation, the customs valuation is generally performed in accordance with the customs valuation principles in the General Agreement on Tariffs and Trade (GATT).

The customs value is determined based on one of the six provided valuation methods (i.e. transaction value, transaction value of identical goods or similar goods, deductive value, computed value, based on available data, and the unit price method). If the first method is not applicable, then the second method should be applied and so forth.

Preferential tariff treatment

Moldova has concluded free trade arrangements (FTAs) to date with most of the Commonwealth of Independent States (CIS) countries and is also a Central European Free Trade Agreement (CEFTA) contracting state. A preferential tariff treatment is granted for specific categories of goods, depending on their origin and in accordance with the FTAs to which Moldova is a party.

Also, further to the Association Agreement with the European Union (EU), the customs duties on goods originating in the other party are eliminated. The origin of goods can be proven with an EUR.1 movement certificate or an origin declaration.

Customs duties applicable on imports performed in the Republic of Moldova are eliminated, except for products free of customs duties within the limits of the tariff quotas. In case these limits are exceeded, the most-favoured-nation customs duty rate shall apply.

Customs duties applicable on imports performed from the European Union are eliminated, except for the following products:

• Products free of customs duties within the limits of the tariff quotas. In case these limits are exceeded, the most-favoured-nation customs duty rate shall apply.
• Products subject to entry price for which the ad valorem component of the import duty is exempted.
• Products subject to the anti-circumvention mechanism.

Elimination of the customs duties on some specific categories of goods will be gradually made.

Favourable tariff treatment

A favourable tariff treatment presumes a reduction or an exemption from customs duty upon import of specific goods into Moldova, depending on their type or final destination, according to domestic customs law or international agreements to which Moldova is a party.

Customs administration

Moldovan customs legislation provides for:

• the concepts and procedures of post clearance audit
• the obligation of individuals and companies to maintain the necessary documents for customs control for at least four years, and
• the obligation of individuals and companies that perform external trade transactions to maintain the related documents for the purposes of post clearance audit for at least four years. This term runs from the end of the year in which the declarations for release for free circulation or export were accepted.

The Customs Service of Moldova uses procedures for issuing binding tariff and binding origin information. Additionally, companies may use the electronic procedure of customs clearance for the export of goods, as well as specific simplified customs procedures.

Excise duties

Excise duties apply to the production and import of cars, tobacco, alcohol, petrol and lubricants, and other goods. Special excise rates for each type of excisable goods are established in the Tax Code. The rates are widely variable and are based on multiple factors. The excise duty rates are generally established as a percentage applied to the value of goods or as a fixed amount for a certain quantity of excisable goods. However, for specific types of excisable duties, mixed excise duty rates are applicable.

The following are subject to excise duties, unless there is a specific exemption provided:

• Any individual or legal entity producing and/or processing excisable goods on the territory of Moldova.
• Any individual or legal entity importing excisable goods.

Businesses or individuals that produce and/or process excisable goods on the territory of Moldova (or intend to do so) must possess excise duty certificates, which must be granted by the tax authorities before these operations are actually carried out. It is mandatory for individuals or businesses, upon submitting the relevant applications to the tax authorities, to attach the details of the excise premises.

Under certain circumstances, excise duty exemptions may apply. Some excise-liable goods are subject to mandatory excise stamp marking and labelling.

The deadline for payment of excise duties for excisable goods placed in tax warehouse is the 25th day of the month following the dispatch of excisable goods from the tax warehouse.

Tax on immovable property

Tax on immovable property is a local tax paid on real estate (i.e. land and/or construction on the land) by the property owner or owner of material rights. Residents and non-residents owning real estate located in the territory of Moldova have similar obligations.

The maximum and specific tax rate for determining the real estate tax and land tax have been abolished.

The specific tax rates for real estate / land tax are determined annually by the representative and deliberative authorities of the local government.

For legal entities and individuals registered as entrepreneurs, 25 September is the deadline for submitting the calculation and payment of the tax on real estate acquired before 31 August. For real estate acquired after that date, the deadline is 25 March of the tax period following the reporting one.

Taxpayers may no longer benefit from a 15% discount at the payment of the tax on the immovable property by 30 June.

In the event of an owner change during the fiscal year, the previous owner may request recalculation of the real estate tax in proportion to the period in which they were subject to taxation.

Transfer duties

Transfer duties may be applied for notary acts performed by authorised notaries and other persons empowered by law. Transfer duties are applied upon authentication by a notary of sale-purchase agreements regarding plots of land; transfers of houses into private property; alienation agreements of houses, apartments, garages, and other constructions; authentication of mortgage agreements; and other evaluative contracts.

Stamp duties

According to the law on state duty, stamp duty (state duty) is the amount charged by specifically authorised state bodies from individuals and legal entities for the exercise of certain actions or issuance of legal documents of interest to them.

Stamp duties may be applied for, but not limited to, the following:

• Claims submitted to courts of justice.
• Registration of civil status documents.
• Issuance of passports to Moldovan citizens and other related documentation.
• Residence registration.
• Redemption of goods from the state.
• Registration of mortgage, for issue of extracts from the Real Estate Register.
• Notary acts (i.e. for notarisation of sale-purchase agreements of immovable assets).
• Application of the apostil.

Payroll taxes

Salaries and other remunerations provided by an employer to its employees are subject to 12% personal income tax (PIT).

Also, there are available deductions, each resident taxpayer being allowed to claim annual allowances. In 2024, allowances are set at:

Notes

1. This allowance is granted only to Moldovan resident taxpayers whose annual taxable income (with some exceptions) does not exceed MDL 360,000.
2. Individuals can opt for this allowance only provided certain conditions are fulfilled.
3. Individuals may opt for this allowance provided the spouse is eligible for the major personal allowance and does not use it in the period concerned.

All payroll taxes are reported through a unified payroll tax return by the 25th day of the month following the reporting one.

Social security contributions (SSC)

Starting 1 January 2021, new provisions regarding SSC are in force. Thus, mandatory SSC due by the employer and employee are combined into a single 24% rate (with some exceptions) and is fully borne by the employer. The rate of SSC is applied on employees' gross salary, meal tickets, and other recompense. For some specific sectors (public, aviation, agriculture), other rates are applicable.

As of 1 January 2023, the following changes became effective regarding the calculation of the SSC:

• For each full-time employee, the minimum monthly taxable base for the calculation of the SSC cannot be lower than the national minimum monthly salary as determined under the law based on the actual hours worked.
• For each part-time and reduced-work schedule employee, the SSC calculated by reference to the monthly taxable base cannot be lower than 25% of the SSC determined by reference to the national minimum monthly salary.

See the Other taxes section in the Individual tax summary for more information

The legislation provides an annual fixed SSC for other categories of taxpayers in an amount approved for each year (e.g. MDL 17,522 applicable for 2024).

Companies report their SSC liabilities on a monthly basis (with certain exceptions) through the unique payroll tax return. The SSC due must be transferred by the employer to the budget no later than the 25th day of the month following the reporting one.

Health insurance contributions

The mandatory health insurance contribution is computed as a percentage of wages and other remuneration and starting 1 January 2021 is established at 9% fully borne by the employee. The legislation also provides for an annual fixed amount of health insurance contribution paid by other categories of taxpayers in an amount approved for each year (e.g. MDL 12,636 applicable in 2024).

The mandatory health insurance contribution is declared on a monthly basis by the employer through the unique payroll tax return. The mandatory health insurance contribution due by employee must be transferred to the budget by the employer by the 25th day of the month following the moment of payment of salary and other remunerations.

Environmental pollution payments

Payments for environmental pollution are administered by the Moldovan Tax Authority (MTA). Subject to these payments are producers, importers, and/or purchasers of the specific types of goods that, during their usage, produces pollutants.

Companies subject to tax on environmental pollution should declare and pay it in the following manner:

• Envisaged subjects that are not part of a collective system or have not registered as an individual system are required to pay and submit a report on environmental pollution payments on a monthly basis, by the 30th day of the month following the reporting one.
• Envisaged subjects that are part of a collective system or have not registered as an individual system are required to pay and submit a report on environmental pollution payments on an annual basis, by 30 April following the reporting year.

Road taxes

Road taxes are fees collected for the use of roads and/or protection zones of the roads outside the locality limits.

The system of road taxes includes the following:

• Tax for the use of roads by vehicles registered in Moldova.
• Tax for the use of roads of Moldova by vehicles not registered in Moldova (vignette).
• Tax for the use of roads by the vehicles with total mass, axle loads, or dimensions exceeding the admitted limits.
• Tax for the use of road protection zones outside the localities for carrying out construction or installation works.
• Tax for the use of road protection zones outside the locality limits for placing outdoor advertisements.
• Tax for the use of road protection zones outside the locality limits for placing roadside service objects and commercial economic objects.

Depending on the type of road tax, the tax law establishes the taxable person, deadlines for payment of the road tax, tax rates, exemptions (e.g. a legal entity or an individual shall pay road tax on vehicles registered in Moldova (i) on the date of state registration of vehicle or (ii) on the date of the vehicle inspection/annual technical testing of the vehicle).

Road tax rates for the use of roads by vehicles registered in Moldova vary depending on the type of vehicle and its specific characteristics (engine capacity, weight, etc.).

The fixed tax rates for vignette vary from EUR 4 to EUR 85, depending on the period the vehicle stays in the territory of Moldova.

Starting 1 January 2024, mopeds, scooters, motorbikes, motorcycles, and vehicles with electric motor are subject to road tax.

Taxes on natural resources

As of 1 January 2021, several taxes on natural resources have been repealed, and the following taxes apply:

• Tax on the water.
• Tax on the mineral exploration.
• Tax for the usage of underground areas.

As of 1 January 2024, natural resources taxpayers have to submit the tax return and pay the taxes by the 25th day of the month following the end of the reporting quarter as follows:

• 50% of the tax amount is paid to the first-level local budget.
• 50% of the tax amount is paid to the state budget.

Local taxes and duties

Local taxation in Moldova refers to the application of the following main types of taxes and duties:

• Duty for the right to perform local auctions and lotteries.
• Tax on advertising placement and tax on advertising devices.
• Fee for the right to use local symbols.
• Land improvement duty.
• Tax for commercial and/or services providing units.
• Parking tax.
• Hotel room occupancy tax.
• Resort fee.
• Tax for provision of passengers’ transport services on the municipalities, cities, and villages (communes) territory.
• Market fee.
• Fee for dog owners.

Local authorities are authorised to decide the type of local taxes to be applied and the level of tax rates for each local tax.