Romania: legislative developments with immediate business relevance

Last week, the Ministry of Finance issued the much-anticipated draft bill for Romania’s economic relaunch, proposed by the Social Democratic Party (PSD). The law focuses on supporting the business environment and aims to boost investment, innovation, and growth. Among its main provisions, companies investing in strategic sectors such as advanced technologies, digitalization, and green transition can access financial aid through grants, state guarantees, subsidized loans, and financing. Additionally, the law introduces expanded tax incentives, including accelerated depreciation for certain assets and tax benefits for reinvested profits, designed to reduce fiscal pressure on companies undertaking major projects. Other measures target microenterprises, offering more flexibility and higher VAT collection thresholds to improve cash flow and stability.

With high chances of adoption, the bill is likely to undergo amendments following consultations with social partners. While the Government may assume responsibility to push it through Parliament quickly, the final version of the law could differ slightly from the current draft.

Companies will have easier access to funding and lower costs for major investments, making their projects more feasible. Tax incentives will reduce the effective fiscal burden, improving cash flow and profitability. Microenterprises will face less risk of losing their status, benefit from higher VAT thresholds, and gain stability for growth and hiring. Overall, companies that act quickly can invest, innovate, and expand more confidently under the new framework.

Businesses should review their investment plans to ensure eligibility for support, adapt internal fiscal and operational structures to leverage the new measures. Until the bill will be fully adopted, we advise companies to closely monitor the possible updates of the bill throughout its legislative process, including implementing norms and regulations, in order to take full advantage of the opportunities.

On Friday, 6 February, the Ministry of Health issued a draft emergency ordinance introducing exceptions to the rule on unpaid first-day sick leave (GEO 91/2026). The proposal stipulates that for multiple consecutive medical certificates for the same illness, the deduction from the allowance applies only once, for a single day, regardless of the number of certificates issued. Reductions will also not apply to maternity and maternal risk leave, patients in national health programs, or those hospitalized continuously or for day care. The measure responds to issues caused by Article II of GEO 91/2025, which disrupted allowance payments and affected treatment and social protection. At the same time, the Ombudsman has also referred the aforementioned Article II to the Constitutional Court, highlighting concerns about its impact.

We expect this ordinance to be quickly adopted by the Executive and passed briefly through the two chambers of the Parliament, for the rapid correction of the provisions regarding the first day of sick leave.

Employers will continue to cover days 2 – 6 of sick leave, while the state pays from the 7^th day onward. The exceptions reduce financial and administrative burdens for employees in critical health situations and ensure continuity of treatment, protecting vulnerable groups from the effects of the first-day unpaid rule.

The draft ordinance is now open for consultation and may undergo changes before its adoption. Companies and employees should monitor the final form of the law and adjust payroll and HR procedures accordingly to comply with the updated rules.

A new legislative proposal filed in the Senate by PNL deputy Dragoș Ciobotaru would allow employers to contribute up to 500 RON/month for each employee to occupational pension funds. Employer contributions would be deductible from corporate income tax, subject to minimum thresholds of 0.75% of turnover or 20% of the profit tax due. The contributions would not be taxed as income and would be exempt from social security contributions, meaning neither employers nor employees face extra fiscal costs. In addition, employer contributions to occupational pensions will use the same tax rules as donations and sponsorships, meaning companies can deduct them from corporate income tax in a simple and predictable way.

Since this proposal is only supported by PNL MPs, without the help of their Coalition partners, the provisions have small chances of being approved by the two parliamentary chambers. Even so, there is a need to closely watch the main legislative procedural steps.

Companies can support employee pensions while reducing taxable profits. Employees benefit from additional pension contributions without extra taxes or social contributions. By extending the existing sponsorship mechanism to occupational pensions, the law encourages employers to contribute directly to employees’ private retirement savings while keeping the budget impact neutral for the state.

If the provisions are approved, businesses should update payroll to include employer pension contributions, stay within the 500 lei per employee/month limit, and record them correctly for tax deductions. HR and finance teams should ensure eligibility and compliance with thresholds before the law takes effect on 1 January following publication.