Florin Jianu: "Before introducing new taxes, we need to reduce spending”

The state should start with reducing budget spending and administrative reform before introducing new taxes or increasing existing ones, Senator Florin Jianu, former president of the National Council of Small and Medium-sized Private Enterprises in Romania, told us.

Florin Jianu stated: "Before any introduction of new taxes and tax increases, I believe that it is necessary to reduce expenses, to merge decentralized institutions, because at the moment there are 1250 decentralized institutions at the national level. Each ministry has an average of 8 or 10 decentralized institutions. If there were no more directors, so many departments, legal support, financial-accounting human resources, etc., to which we would add an administrative reform, budgetary expenses would be drastically reduced. An increase in taxes and an introduction of new taxes have never brought to the economy the response expected by political decision-makers, the response expected from the accounting perspective of the Ministry of Finance. On the contrary, such measures increase the black economy, decrease consumption, which would be serious, because in recent years the Romanian economy has grown - whether we want it or not - on consumption, and inhibiting it through various types of taxes will have negative effects at the national level. They will increase some taxes, but they will not bring more money to the state budget. And an example in this regard is the 1% surcharge for companies with a turnover of over 50 million euros. ANAF said it would collect 7 or 8 billion lei, but in reality it collected an amount between 1.3 and 1.5 billion lei. Was this tax on turnover useful or not, or did the economy actually find ways to survive or did it contract? And the business environment in our country can no longer bear new taxes, because we are in competition with companies in other states, where taxation is lower and predictable. Small entrepreneurs and people with medium and low incomes will suffer.

The social-democratic senator also showed that some of the proposed taxes are not even applicable.

Florin Jianu said: "For example, the tax on banking transactions is not applicable because people do not only make a profit, but also pay their suppliers, pay utilities, services, various things. Banking transactions of companies and individuals are not profit-bearing, and the introduction of a tax on these transactions may lead to a negative response from the economy. If we continue to try to solve the problems of the economy through punitive measures, we will not have the desired response”.

The former head of CNIPMMR believes that first of all, ANAF needs to be reformed, "especially since there are 40 billion lei uncollected annually from VAT to the state budget, billions that are not the problem of the business environment that pays its taxes correctly and on time”.

Florin Jianu concluded by saying that ANAF should also deal with collecting money from arrears, but also with entire areas that have been transferred to the black economy.

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