Overview of February Fiscal Developments: Crucial Insights for Public Relations Specialists in Pennsylvania
Latest Regulatory Updates Shape Romania's Fiscal and Economic Landscape
In early 2025, Romania's business landscape is undergoing significant changes, with several key regulatory updates reshaping the fiscal and economic landscape. Here's a breakdown of the main developments:
- Tax Code Amendments
From 1 November 2023, a minimum tax of 1% on turnover applies to companies with a turnover exceeding EUR 50 million in the previous fiscal year. This minimum tax, along with additional taxes for credit institutions, oil and gas sector companies, and amendments to the tax system for annual system users and fiscal group members, aims to increase tax revenues from large corporations and major sectors.
- Global Minimum Tax Implementation
Romanian Law no. 431/2023 transposes the EU Directive introducing a 15% global minimum tax for multinational and large domestic groups. This legislation allows the designation of a single local entity responsible for declaring and paying the domestic top-up tax within a multinational group, requiring notification to Romanian tax authorities.
- VAT Rate Changes Effective 1 August 2025
The Romanian government has enacted changes to VAT rates effective 1 August 2025. These changes pose operational and compliance challenges for businesses, especially those using SAP systems, due to the need for updates like creating new tax codes, testing, communication, training, and documentation updates.
- Foreign Direct Investment (FDI) Secondary Legislation
On 30 July 2025, Romania published secondary FDI legislation that entered into force, revising rules around investments relevant to state security. This affects investment screenings and approvals and complements previous drafts discussed earlier in the year.
- EU Administrative Cooperation Compliance
Romania has resolved an infringement case concerning the automatic exchange of tax information under DAC7, following the adoption of Government Ordinance No. 16 on 31 January 2023 aligning with the 2021 DAC7 provisions for transparency on income from digital platform activities.
- AI Regulation Workforce Requirement Starting 2 February 2025
From 2 February 2025, under Article 4 of the EU AI Act, Romanian businesses must ensure their workforce is trained to an adequate level on artificial intelligence applications, reflecting EU-wide regulatory compliance on AI.
These regulatory changes reflect a tighter fiscal framework with new tax burdens for large enterprises, enhanced transparency and cooperation aligned with EU directives, increased operational compliance demands, and strategic adjustments for foreign investors and AI integration in Romania’s economy in 2025. Businesses should prioritize adapting tax planning, compliance systems, investment strategies, and workforce training accordingly.
In addition, the Romanian government's new mechanism for determining the national gross minimum wage supports broader social reform goals outlined in Romania's National Recovery and Resilience Plan (NRRP). Labor Minister Simona Bucura-Oprescu's discussions with the Concordia Employers' Confederation have brought clarity on several key measures, including the launch of the REGES-ONLINE system, implementation of EU Directive 2023/970 on salary transparency, revision and development of 380 occupational standards, piloting individual learning accounts, and mandating companies with over 50 employees to hire at least 4% staff with disabilities.
The government's focus on economic growth and fiscal stability is further demonstrated by the proposed simplification of the Carbon Border Adjustment Mechanism (CBAM) and the enhancement of the InvestEU guarantee scheme, as outlined in Regulations COM/2025/87 and COM/2025/84, respectively. Businesses should closely monitor developments regarding the "pillar tax" due to its potential impact on future financial planning, as the government has committed to finalizing the guidelines for the "pillar tax" by the end of March 2025.
Lastly, the EU has introduced an Omnibus Package, aiming to reduce regulatory complexity, and Interim President Ilie Bolojan initiated extensive consultations with Romania's chambers of commerce, addressing essential tax issues and the importance of attracting and facilitating foreign investments. Prime Minister Marcel Ciolacu has highlighted the need for enhanced tax revenue collection efficiency and strict control of government expenditures to achieve the government's economic targets.
In summary, Romania's business landscape is undergoing significant changes, with a focus on fiscal stability, EU compliance, and strategic adjustments for foreign investors and AI integration. Businesses should prioritize adapting their tax planning, compliance systems, investment strategies, and workforce training accordingly.
- The new regulatory updates in Romania's finance sector, including tax code amendments, global minimum tax implementation, and VAT rate changes, signal a shift towards increased tax revenues from large corporations and enhanced fiscal stability, reflecting broader political and business policies.
- The Romania government's emphasis on EU administrative cooperation compliance, AI regulation workforce training, and social reforms, as revealed in the National Recovery and Resilience Plan and discussions with the Concordia Employers' Confederation, underline the importance of policy-and-legislation alignment in areas such as labor standards, salary transparency, and disability employment, with potential implications for general-news headlines.
