Romania: legislative developments with immediate business relevance

Romania now has a set of measures for its economic relaunch, after the Executive adopted and published in the Official Gazette the emergency ordinance in this regard. As explained in our previous reports, the measures continue to focus on boosting investment, innovation, and growth, offering grants, state guarantees, subsidized loans, and financing to companies investing in strategic sectors. Expanded tax incentives, including accelerated depreciation and benefits for reinvested profits, are designed to reduce fiscal pressure, while microenterprises benefit from higher VAT thresholds and greater operational flexibility.

The Ordinance has already reached the Parliament, and the draft bill for its approval has been registered in the Senate for the first round of debates. However, we do expect the MPs, especially the Coalition ones, to bring several amendments that could improve the ordinance.

Businesses stand to gain improved access to financing and clearer rules on tax treatments, which reduces uncertainty and fiscal risk. Companies can optimize investment projects, plan depreciation more effectively, and account accurately for pension-related contributions. Microenterprises gain stability through higher VAT thresholds and more predictable cash flow.

Companies should review investments in strategic sectors to access grants, loans, and tax incentives, adjust payroll and hiring to account for higher minimum-wage costs, and, for microenterprises, leverage higher VAT thresholds and operational flexibility to improve efficiency.

The Ministry of Finance has issued a draft ordinance introducing several fiscal changes, notably tightening rules on the transfer of shares in limited liability companies and revising aspects of the RO e-VAT system. Under the proposal, share transfers will only be recognized by tax authorities after verification of the company’s fiscal status and submission of a tax clearance certificate, aiming to prevent the transfer of companies with outstanding tax liabilities. The draft also removes certain RO e-VAT compliance notification mechanisms and suspends the communication of taxpayers’ fiscal risk classification until the end of 2026.

The ordinance will most probably be amended and republished on the Ministry’s website, given that several provisions on excise duties were already adopted through another ordinance from last week.

Companies involved in share transfers will face stricter tax checks, potentially delaying transactions and increasing administrative requirements. At the same time, the temporary suspension of fiscal risk communication may reduce immediate compliance pressure, though uncertainty around risk classification remains.

Businesses planning share transfers should ensure all tax obligations are settled and documentation is in order to avoid delays, in case the ordinance is adopted. Companies should also monitor further changes to the RO e-VAT system and prepare for the reintroduction of fiscal risk communication after 2026.

A new legislative initiative by USR and UDMR, registered in the Senate, proposes to abolish fiscal depreciation and replace it with full, immediate deductibility of all expenses related to the acquisition, production, or construction of fixed assets. Under the proposal, the entire value of an investment would reduce taxable profit in the year the expense is incurred, rather than being spread over the asset’s useful life. It also allows full recovery of past fiscal losses without the current 70% annual limit.

With low to medium chances of passing the Parliament’s vote, the proposal currently waits to start its debates in the Senate’s committees, where MPs could bring amendments.

Companies could benefit from significant cash flow improvements and reduced effective tax burdens, making investments in fixed assets more financially attractive. The changes increase predictability in financial planning, provide more flexibility in managing losses, and simplify accounting for tax purposes.

If the bill is adopted, businesses should review current and planned capital expenditures, assess potential tax savings under immediate deductibility, adjust financial planning and accounting practices, and monitor the government’s forthcoming methodological norms to ensure correct application if the law is adopted.

A cross-party legislative proposal registered in the Senate requires the National Health Insurance House (NHIH) to pay sick leave allowances within 90 days of receiving the supporting documents. Late payments would incur penalties of 0.01% per day. The provisions enter into force 30 days after publication in the Official Gazette, aiming to address delays and ensure timely income protection for insured individuals.

As the proposal is supported by all parliamentary political parties, we expect it to swiftly pass the vote of the two chambers, without major amendments.

Companies may experience fewer payroll disruptions and reduced administrative follow-ups related to employees’ medical leave payments. Timely disbursement of allowances by the NHIH can improve cash flow predictability for both employers and employees, indirectly supporting workforce stability and satisfaction.

Employers should update internal procedures to submit medical leave documentation promptly, monitor the NHIH payments for compliance with the new deadlines.