On July 25, 2025, Law no. 141/2025 concerning certain fiscal-budgetary measures ("Law no. 141/2025") was published in the Official Gazette of Romania, introducing numerous changes in the fiscal domain aimed at bolstering Romania's long-term financial sustainability, as follows:
Dividend Tax
Starting January 1, 2026, the tax rate on dividend income increases from 10% to 16%. Dividend distributions made before this date will be subject to the 10% rate.
Turnover Tax for Credit InstitutionsEffective August 1, 2025, the turnover tax applicable to credit institutions is modified as follows:
▸2% for the period January 1 - June 30, 2025;
▸4% for the period July 1 - December 31, 2025.
VAT
Effective August 1, 2025:
▸ The standard VAT rate increases from 19% to 21%;
▸ Reduced VAT rates of 5% and 9% are eliminated;
▸ A single reduced VAT rate of 11% is introduced. The new 11% VAT rate applies to: Medicines, Food and beverages (excluding alcoholic beverages and sugary foods), Dietary supplements, Fertilizers, School textbooks, Books, Firewood, Social housing, Accommodation in the hotel sector, Restaurant and catering services.
Excise Duties
Effective August 1, 2025, excise duties on alcohol, tobacco, and fuel are increased by approximately 10%.
Income Tax and Social Contributions
Effective August 1, 2025, a series of changes will be introduced to the income tax system, as follows:
▸ The tax rate will be increased from 10% to 16% (applied from January 1, 2026), for income in the form of distributed dividends, as well as for gains derived from holding units in collective investment undertakings.
▸ Clarifications are provided regarding the taxation of interest income: for bonds issued by Romanian resident companies on foreign capital markets, the interest paid and recorded in the issuer’s accounting records will be subject to a 10% tax. This tax is calculated by the taxpayer and reported through the Single Tax Declaration.
▸ For pension income, the taxable base is determined by deducting a non-taxable monthly amount of 3,000 RON and the health insurance contribution due from the gross pension income.
▸ The tax rates for gambling income are revised as follows: 4% for amounts up to 10,000 lei; 20% for amounts exceeding 10,000 lei; 40% for amounts exceeding 66,750 lei.
▸ Income obtained from the sale of ferrous and non-ferrous metal waste, as well as their alloys, originating from personal assets, will be classified as income from other sources and will be subject to withholding tax by the economic operator.
The exemption from paying CASS is eliminated for the following categories of individuals: Spouses, parents without their own incomes, who are dependents of an insured person; Politically persecuted persons; Individuals receiving unemployment benefits or other social protection rights; Individuals on adoption accommodation leave; Individuals on child-raising leave; Individuals receiving social assistance; Monastic personnel of recognized religious denominations; Pensioners with pensions exceeding 3,000 lei.
It is now possible for individuals already paying CASS for themselves to opt to pay the health contribution (2,430 lei/year) for a dependent (e.g., spouse, parent without income) through the Single Tax Declaration.
For pension income, this measure applies only for the period from August 1, 2025, to December 31, 2027.
The calculation method for temporary incapacity benefits (due to illness or non-work-related accidents) is revised based on the duration of sick leave as follows: For sick leaves up to 7 days, 55% of the base calculation is granted; For sick leaves between 8 and 14 days, 65% of the base calculation is granted; For sick leaves exceeding 15 days, 75% of the base calculation is granted.
