The new tax code: what changes in VAT

With the publication of the Law no. 227/2015 (Lege 227/2015) profoundly changed the tax code effective January 1, 2016.

Among the many changes, which we will give more detail about, we briefly highlight what will change regarding value-added tax.

1. The ordinary tax rate is reduced from 24% to 20%, and from January 1, 2017, it will be reduced to 19%;
2. Reverse taxation: reverse taxation has been reintroduced for real estate and land of any kind, either by law or by option;
3. The already ongoing simplification of reverse taxation valid until Dec. 31, 2018 extends to the supply of grain, supply of electricity and the world of telephony and electronics;
4. the5 percent rate is extended to supplies of: school textbooks, newspapers, museum entrance fees, tickets and services related to sporting events;
5. Prescription of the right to deduct tax: if as a result of tax verification at its suppliers, the verifiers recognize a greater right to tax deduction for the recipient of the services/goods, this right can be exercised within one year from the date of receipt of the corrected invoices as a result of the tax verification to no avail the possible lapse of 5 years of the occurrence of the right to deduct of the original invoice (prescription period);
6. Invoicing: the recipient, subject to VAT, of goods and services who does not receive the invoice for the correction of the taxable base from the supplier is obliged to issue the self-invoice in order to regularize its position at the latest within 15 days from the event that generated the correction obligation;
7. The ability to recover credit VAT for invoices issued is also extended to situations of clients who have a reorganization plan finally approved by court ruling ( and not only as before for bankruptcies).

We remain available for clarification.