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News from Members Romania Jumps to the 52 Position in the Paying Taxes 2015 Rankings

Romania Jumps to the 52 Position in the Paying Taxes 2015 Rankings

by PwC November 20, 2014

Romania jumps to the 52 position in the Paying Taxes 2015 report carried out by PwC and the World Bank, which measures the ease of paying taxes in 189 economies worldwide for an average sized company.

„Romania is one of the highlights of this year’s edition of the Paying Taxes report, as result of the steps taken by the tax authorities between 2010-2013, which facilitated electronic filling and payments” stated Mihaela Mitroi, Tax and Legal Services Leader, PwC Romania.

In consequence, Romania’s ranking is currently one of the best in Central and Eastern Europe. It surpassed Poland (87), Hungary (88), Bulgaria (89), Slovakia (100) and the Czech Republic (119), however it is outranked by the Baltics States (Latvia – 24, Estonia – 28, Lithuania - 44), Croatia (36) and Slovenia (42).

Romanian companies must perform 14 annual payments (compared to the European average of 12) and spend 159 hours to comply with tax requirements (176 being the European average), though when it comes to the total tax rate, which evaluates the corporate income tax that a mid-sized company must pay, Romania ranks slightly above the European average of 41%, with a 43.2% tax rate.

„Tax authorities are currently engaged in the extremely important reform process of the National Authority for Tax Administration which should translate into an increase in tax collection, tax evasion tackling and also improving taxpayer satisfaction” added Mihaela Mitroi.

At international level, the total tax rate of the standard company is 40.9% of commercial profits, it makes 25.9 tax payments per year and spends 264 hours in order to comply with tax requirements.

The average time it takes a medium size company to deal with its tax submissions has fallen by a total of nearly a week and a half over the ten years of the study, reflecting the increased use of electronic filing and payment systems around the world. Of the 379 tax reforms recorded in Paying Taxes reports since 2004, 105 relate to electronic filing.
About the Paying Taxes Report
Paying Taxes 2015 measures all mandatory taxes and contributions that a medium-size company must pay in a given year. Taxes and contributions measured include the profit or corporate income tax, social contributions and labour taxes paid by the employer, property taxes, property transfer taxes, dividend tax, capital gains tax, financial transactions tax, waste collection taxes, vehicle and road taxes, and other small taxes or fees.
The Paying Taxes 2015 report measures how easy it is to comply to fiscal regulations in 189 economies around the world, taking into consideration three main indicators: the total tax rate, which calculates the share of taxes and contributions a company has to pay of commercial profits, the time it takes to comply with tax requirements, which takes into consideration the total amount of hours the company assigns to meet the imposed reporting and tax payments, and the number of payments that a company must make in order to comply with tax obligations. Last year, Romania ranked 134.

For more information about the Paying Taxes study, visit: www.pwc.com/payingtaxes.
The Paying Taxes annual report builds on the World Bank Group’s Doing Business reports’ chapter on Paying Taxes. For more information on the Doing Business report series, visit: www.doingbusiness.org

About the World Bank Group

The World Bank Group plays a key role in the global effort to end extreme poverty and boost shared prosperity. It consists of five institutions: the World Bank, including the International Bank for Reconstruction and Development (IBRD) and the International Development Association (IDA); the International Finance Corporation (IFC); the Multilateral Investment Guarantee Agency (MIGA); and the International Centre for Settlement of Investment Disputes (ICSID). Working together in more than 100 countries, these institutions provide financing, advice, and other solutions that enable countries to address the most urgent challenges of development. For more information, please visit www.worldbank.org, www.miga.org, and ifc.org.

About PwC:
PwC firms help organisations and individuals create the value they’re looking for. We’re a network of firms in 157 countries with more than 195,000 people who are committed to delivering quality in assurance, tax and advisory services. Find out more and tell us what matters to you by visiting us at www.pwc.com.
PwC refers to the PwC network and/or one or more of its member firms, each of which is a separate legal entity. Please see www.pwc.com/structure for further details.
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