Retail trade in collapse: although turnover is increasing, volumes have decreased drastically

The National Institute of Statistics published a press release yesterday showing that in July 2025 the volume of turnover in retail trade (excluding trade in motor vehicles and motorcycles) increased compared to June 2025, both as a gross series by 7.1% and as a series adjusted according to the number of working days and seasonality by 0.3%. The cited source also states, based on the data collected, that, compared to July 2024, the volume of turnover in this type of trade increased in July 2025 by 5.3% - as a gross series and by 4.5% - as a series adjusted according to the number of working days and seasonality.

Although official figures show an increase in retail turnover, the reality hidden behind these percentages is less optimistic, if we carefully analyze the data presented by the INS in the respective press release. The increase in sales value is, in large part, the consequence of inflation fueled by increased taxes and duties, which makes the advance more nominal than real.

In terms of volume, the goods purchased by the population are losing consistency, and the decline is visible where the economic and social impact is most sensitive: in food products. If in July 2024 compared to July 2023, retail sales of food products in real terms increased by 5%, in July 2025 compared to July 2024 the advance is only 0.5%, which is practically equivalent to a contraction of 4.5 percentage points in the volume in this segment. It is a decrease that directly reflects the pressure on family budgets and the purchasing power of the population, because food products are the basis of retail trade in Romania and the first indicator of the health of consumption.

This situation was also noted by entrepreneurs in the field, whose representatives told the BURSA newspaper that the situation in retail trade has deteriorated drastically compared to 2024 and that several companies have already recorded losses of over one million lei in the first seven months, which is leading them to lay off workers, sometimes even dozens of employees. They also told us that the situation in retail trade was worsened, in addition to the increase in taxes and fees, by the minimum turnover tax (IMCA) for companies whose annual turnover exceeds 50 million euros, a tax introduced by the Ciolacu government and which the Bologna government eliminated last Friday, only to reintroduce it on Monday, September 1, 2025, under pressure from the PSD.

"The politicians' statements regarding the fact that IMCA applies to corporations, multinationals are erroneous. It is not written anywhere in the normative act that IMCA applies only to them, because you cannot introduce a tax depending on the origin of the capital. Very many companies in our country, with 100% Romanian capital, in the field of retail trade, but also in other sectors, which exceed the annual turnover of 50 million euros, are affected by the introduction of IMCA and in practice the tax primarily affects Romanian companies and not multinationals as the politicians claim”, representatives of entrepreneurs in trade told us.

Political sources have informed us that the governing coalition, at the proposal of some social-democratic leaders, will discuss in the coming period the lowering of the threshold for applying IMCA from 50 million euros to 10 million euros of annual turnover.

"It would be a disaster for companies with Romanian capital if such a decision were made,” said the representatives of retail entrepreneurs, whom we asked what they thought about such a measure.

Regarding the trend of slowing volumes, from the press release sent by the INS we note that this is also found in the general dynamics of trade. In July 2025, compared to the previous month, the seasonally adjusted volume of turnover rose by only 0.3%, and compared to July 2024, the increase is 4.5%, substantially lower than the 7.6% advance recorded in July 2024 compared to July 2023. Basically, the consumer economy is sounding an alarm: the engines are no longer working with the same intensity, and the population is buying less in real terms, even if the values on the vouchers seem higher.

By segment, the only ones that maintained dynamism are fuels, with an increase of almost 12% in July 2025 compared to July 2024, after a previous year of stagnation. Non-food products also continued to grow, but at a moderate pace, of 5.8% compared to 12.8% recorded a year earlier.

Looking at the first seven months of 2025, retail trade shows only modest growth, of 3.5% seasonally adjusted compared to the same period of the previous year. Again, the structure clearly shows imbalances: non-food increases strongly, fuels maintain a positive pace, but food supplies contract slightly, signaling the fragility of domestic demand. This polarization between segments is not a healthy sign for the market, because supporting a consumption-based economy requires relatively uniform growth, especially in the area of basic products.

The conclusion that must be made is that, beyond the appearance of a growing consumption economy, the figures adjusted for inflation and seasonality show a much more austere reality. Citizens are paying more for less, and the decline in volume in food retail is the clearest evidence that fiscal pressure and price increases are constantly eroding purchasing power. In a context in which retail remains the main engine of the economy, the message sent by the July 2025 data is a warning: without measures to support real consumption, not just value, the risk of stagnation is becoming increasingly present.