On September 6, 2024, Emergency Ordinance no. 107/2024 came into effect, regulating certain fiscal-budgetary measures related to the management of budgetary receivables and the budget deficit for Romania’s consolidated general budget for the year 2024.

Based on the Ordinance, natural persons, legal entities under public or private law, associations, and other entities without legal personality, authorized individuals or those exercising liberal professions, administrative-territorial units or subdivisions of Bucharest municipality, or public institutions may benefit from the cancellation of either 50% or 25% of their main outstanding budgetary obligations as of August 31, 2024, provided that the diminished principal obligations (by 50% or 25%) are paid by November 25, 2024.

The main outstanding obligations as of August 31, 2024, are understood to be:

a) Budgetary obligations that became due for payment by August 31, 2024, inclusive. Main budgetary obligations owed by a debtor in insolvency proceedings that became due by August 31, 2024, inclusive, are also considered outstanding, irrespective of the existence of a claims table or a payment schedule for the receivables.

b) Differences in main budgetary obligations established by tax decisions communicated by August 31, 2024, inclusive, even if the payment deadline stipulated by art. 156 para. (1) of Law no. 207/2015 regarding the Fiscal Procedure Code, as amended, has not yet been met, as well as differences in main budgetary obligations related to tax periods up to and including August 31, 2024, established by the central tax authority through a decision communicated by the time the emergency ordinance comes into effect, following a tax audit.

c) Main budgetary obligations related to tax periods up to and including August 31, 2024, established by a tax decision issued ex officio by the tax authority or through a late tax return submitted by the taxpayer between September 1, 2024, and the date of submission of the request for cancellation of the accessories, inclusive.

d) Other payment obligations individualized in enforceable titles issued according to the law and recorded by the tax authority as of August 31, 2024, inclusive, as well as main budgetary obligations established by authorities other than tax authorities, related to tax periods up to and including August 31, 2024, forwarded to the tax authorities for recovery between September 1, 2024, and the date of submission of the request for cancellation of accessories, inclusive.

According to Ordinance no. 107/2024, debtors who are natural persons with outstanding main budgetary obligations as of August 31, 2024, amounting to less than or equal to 5,000 lei, may benefit from the cancellation of 50% of their main budgetary obligations outstanding as of August 31, 2024, if 50% of these obligations are settled by the time the request for cancellation is submitted, but no later than November 25, 2024. Additionally, the interest, penalties, and all accessories related to these main budgetary obligations will be canceled if the principal obligations are paid.

On the other hand, debtors who are natural persons with outstanding main budgetary obligations exceeding 5,000 lei as of August 31, 2024, may benefit from the cancellation of 25% of their main budgetary obligations if 75% of these obligations are settled by the time the request for cancellation is submitted, but no later than November 25, 2024. Additionally, the interest, penalties, and all accessories related to these main budgetary obligations will be canceled if the principal obligations are paid.

Furthermore, interest, penalties, and all accessories related to main budgetary obligations outstanding as of August 31, 2024, will be canceled if:

• All main outstanding budgetary obligations as of August 31, 2024, managed by the central tax authority, are settled by the time the request for cancellation of accessories is submitted, but no later than November 25, 2024.
• All main and accessory budgetary obligations managed by the central tax authority, with payment deadlines between September 1, 2024, and the date of submission of the request for cancellation of accessories, inclusive, but no later than November 25, 2024, are settled.
• The debtor has submitted all tax returns, according to the tax vector, by the time the request for cancellation of accessories is submitted.
• The debtor submits the request for cancellation of accessories (after the appropriate conditions are met) by November 25, 2024.

On September 19, 2024, Order no. 5521/16.09.2024 was published in the Official Gazette, Part I no. 944, approving the Procedure for the Cancellation of Certain Budgetary Obligations.

Author: Atty. Ionut Sfetcu