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Romania abolishes the 1% deductibility cap for intra-group IP and management/advisory expenses
At the beginning of 2026, we informed you about a significant tax reform enacted by the Romanian legislature, introducing a new limitation on the deductibility of certain intra-group expenses. Under this measure, taxpayers with turnover below EUR 50 million (not subject to the minimum turnover tax, i.e., IMCA) were allowed to deduct expenses related to intellectual property rights and management and advisory services received from non-resident affiliated parties only up to 1% of total expenses, with any excess being treated as non-deductible for corporate income tax purposes. The measure has now been repealed. Through Government Ordinance no. 6/2026 published on 30 January 2026, the Romanian legislature
Romania’s new gas licensing rules: A closer look at the PE risk for foreign suppliers and traders
Starting January 2026, important changes have been introduced in Romania for holders of gas supply or trading licences by the national energy regulator, ANRE, through ANRE Order 83/2025 (the “Order 83/2025”), which repeals ANRE Order No. 199/2020 approving the regulation for granting permits and licences in the natural gas sector. In a nutshell, in order to obtain a gas supply or trading licence, applicants will need to file: evidence of having financial resources to carry out their activities of at least EUR 200,000 as opposed to the previous regulation (which required financing resources of 25% of the estimated turnover to be achieved in the first 12 months of activity, but not less than EUR 100,000)
Profit or price? Decoding the new divide in VAT and transfer pricing
For a long time, tax authorities and practitioners lived with the growing fear that every Transfer Pricing (TP) adjustment would automatically trigger a VAT consequence. However, two recent developments at the CJEU have provided a much-needed map for this terrain. While the Court’s ruling in Arcomet (C-726/23) reinforced the transactional nature of VAT, AG Kokott’s recent Opinion in Stellantis Portugal (C-603/24) suggests a vital stopping point: VAT cannot simply "swallow" profit-level adjustments. The Arcomet Standard: VAT follows the transaction, not the method The CJEU’s judgment in Arcomet sent a clear message. When a contract includes price remuneration and revision clauses, using a TNMM-based mechanism
Major tax and procedural changes in Romania
On 15 December 2025, the Romanian Parliament adopted Law no. 239, which will enter into force on 18 December 2025. The law introduces significant amendments to the Fiscal Procedure Code, the Fiscal Code, and other related regulations. The main changes are presented below: Legislative updates regarding legal entities As of 1 January 2026, taxpayers which had in the previous year a turnover below EUR 50 mil. (note: those not subject to IMCA), incurring expenses related to intellectual property rights, management, advisory from non-resident affiliated parties, where such expenses exceeded 1% of the total expenses according to 2024 accounts, may deduct these expenses, in the current tax year, up to 1%
Key fiscal updates in Romania: Government Emergency Ordinance No. 22/2025 on the VAT regime
The Romanian government has adopted GEO No. 22/2025 introducing significant amendments to Romanian VAT legislation and directly affecting small enterprises and VAT registration procedures. The new rules transpose EU provisions into domestic law and aim to ensure a more uniform application of the small business exemption regime across the EU effective 1 September 2025. 1. Updates to the special VAT exemption regime for small enterprises Annual turnover limit for VAT exemption eligibility has increased from RON 300,000 to RON 395,000 (approx. EUR 77,000). Transitory provisions are introduced for companies that exceeded the previous eligibility threshold in August 2025. 2. Cross-border VAT simplification
Legislative amendments in Romania regarding advance pricing agreements
The Romanian tax authorities have recently enacted legislative changes concerning advance pricing agreements (APAs), with the aim of enhancing the regulatory framework and supporting tax compliance. Key amendments include: The introduction of the possibility to request the issuance of an APA for historical transactions, with retroactive application of up to five years, subject to conditions that will be detailed in secondary legislation. The option for the tax authorities to suspend tax audits for periods covered by submitted APA requests, in order to prioritise their resolution. A revision of the mutual agreement procedure for the avoidance of double taxation, aimed at facilitating the resolution
Important fiscal changes in Romania starting August 2025 / January 2026
On 25 July 2025, the Romanian Parliament adopted Law 141/2025 regulating a series of important fiscal changes that will enter into force starting August 2025, as summarised below. ⇒ Increase of the dividend tax from 10% to 16% for all taxpayers obtaining income from dividends, i.e., companies, individuals, and non-residents. The increased tax applies to dividends distributed starting 1 January 2026. Certain transitory rules will apply to dividends distributed based on interim financial statements prepared during 2025 (or a modified fiscal year starting in 2025). ⇒ Increase of the supplementary turnover tax for credit institutions (including banks) as follows: from 2% to 4% for the period 1 July
Discount for the payment of certain tax liabilities in Romania – follow-up
As described in our previous newsletter in September 2024, profit taxpayers and microenterprise income tax taxpayers in Romania benefit from a 3% discount of their annual profit/income tax liability related to fiscal year 2024/the modified fiscal year starting in 2024. The procedure for applying the aforementioned discount was approved by Order 540/2025 published on 14 April 2025. To benefit from this discount, taxpayers need to fulfil the following conditions: they must have all mandatory tax returns submitted in due time; the annual profit/income tax related to fiscal year 2024/the modified fiscal year starting in 2024, as the case may be, is paid in full within the applicable legal deadlines;
Changes and clarifications regarding construction tax in Romania
On 4 April 2025, Romania government Emergency Ordinance no. 21/2025 ("the GEO") was published and entered into force, introducing several important amendments and clarifications regarding the recently enacted construction tax. We summarise the main provisions below. Reduction of the tax rate: The construction tax rate has been decreased from 1% to 0.5%. Tax base clarification: It is now explicitly clarified that the 0.5% tax applies to the net book value of constructions. New separate tax (0.25%): A separate tax of 0.25% has been introduced for buildings belonging to the public or private domains of state or administrative-territorial units that are utilised based on contracts, agreements, or legal
Important fiscal changes in Romania starting January 2025
On 30 December 2024, the Romanian government adopted Emergency Ordinance no. 156/2024 (“the GEO”) regulating a series of important fiscal changes that entered into force starting January 2025, as summarised below. 1. Increase of dividend tax from 8% to 10% for all taxpayers obtaining income from dividends, i.e., companies, individuals, and non-residents. The increased tax applies to dividends distributed starting with 1 January 2025. 2. Elimination of tax incentives, i.e., exemption from income tax, reduced pension insurance contribution, for salary income lower than RON 10,000 earned by individuals carrying out activity in IT, construction, agricultural and the food industry. For these sectors, regular (full)
New tax amnesty adopted by the Romanian government
On 6 September 2024, the Romanian government adopted Emergency Ordinance no. 107/2024 (“the GEO”) regulating a nationwide tax amnesty generally aimed at cancelling late payment interest and penalties related to certain outstanding tax liabilities, as summarised below.1. Waiver of interest, penalties and other additional charges for outstanding debts as of 31 August 2024 for all taxpayers. The outstanding debts as of 31 August 2024 include: budgetary liabilities for which the due date or payment term has been met on or before 31 August 2024; supplementary budgetary liabilities established by tax assessment decisions communicated up to and including 31 August 2024, as well supplementary liabilities