The Romanian state is witnessing its fiscal revenues being dramatically reduced by the underground economy; one of the solutions to this, especially now during the financial crisis, would be a better tax collecting system, stated Peter Ruiter, a partner and leader of the tax and legal consultancy department of PricewaterhouseCoopers Romania.
"Romania collects just 70% of overall taxes, compared with other countries where the percentage is much higher," said Ruiter, specifying this was one of the issues recently discussed with the representatives of the National Fiscal Administration Agency (ANAF).
State budget tax revenues scheduled for 2008 amount to over 75bn RON (around 20.6bn euros), according to the Economy and Finance Ministry. Should the remaining uncollected 30% in taxes that Romania fails to collect, as a result of tax evasion and the black market, be collected, tax revenues would top 107bn RON (around 29.3bn euros). Practically, almost 9bn euros were lost just this year.
The head of the tax department at PwC, the biggest advisory services provider, says one of the moves the Romanian state should make is to improve the tax collection system. The search for a solution to the crisis has led to the emergence of two camps: economic analysts, who argue that cutting down consumer spending is the most pressing move that should be made to prevent a hard landing of the economy, and some politicians, who propose tax incentives to boost consumer spending and possibly revive the economy.
Spurring research-development investments and the creation of new jobs are another two issues the Romanian state should focus on to fight the global crisis, believes Peter de Ruiter. A major problem PwC's corporate clients are facing is related to their being paid back VAT by the state. "(...) Companies told us that they would exit Romania because of this. In Bu
