The Romanian Senate on Tuesday adopted a new draft legislation that would exempt reinvested profit from fiscal duties. The main issue in dealing with the proposal was a possible decrease of budget incomes, but the leader of the Conservative Party-PC, which tabled the bill, said the budget might be balanced through supplementary VAT compensations.
According to Catalin Doica, a state secretary at the Finance Ministry, the Government cannot agree with the law because the budget would not be able to support itself without the contribution of profit taxes.
The exemption means lower incomes to the state budget, which doica places at some 1,2% of the GDP by 2009 for a reinvestments of up to 70% of company profits, Doica said, quoted by press agency Rompres.
Passed with 45 votes in favor, 27 against and two abstentions, the bill will be submitted to House debate.