Romania Announces Fiscal Reform Plan

Prime Minister Ilie Bolojan announced Wednesday a fiscal package aimed at reducing Romania’s budget deficit, warning that without swift action, the country risks defaulting on its payments. The Government plans to assume responsibility for the package next week, following public consultations, CE Report quotes Agerpres

Key measures include:

• Capped public pensions and salaries until 2026

• VAT reset to two rates: 11% and 21%, with essentials like food, medicine, and utilities staying at the lower rate

• Increased excise duties on alcohol, fuel, and cigarettes

• Health insurance contribution applied to pensions over 3,000 RON

• Increased teaching hours by two in all education levels

• Stricter criteria for merit and social scholarships

Bolojan emphasized the urgency of the reforms, citing unsustainable borrowing levels. “Romania currently spends 32 RON more than it collects for every 100 RON,” he said, warning that failure to act would cut off access to European funds and compromise salaries and pensions.