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EY official: Turnover tax will generate winners and losers
Turnover tax will generate winners and losers, but damages will exceed gains, stated on Thursday Partner and Leader of Tax and Legal practice of EY Romania Alex Milcev.
"The Government has announced its intention to replace the tax on profit with the turnover tax. The reason hasn't been clearly explained. Supposedly, it would be about the need to streamline the fiscal system. The tax on profit has been a cost (for SMEs - ed.n.) in order to do business in the last 27 years. Thus, the need for a fiscal consultant's intervention disappears. There is an underlying question here: is such a tax appropriate? Doesn't streamlining come at a cost? This tax is not appropriate and it will generate both winners and losers. In our opinion, the damages will exceed the gains," said Milcev in a press conference.
According to him, there are many businesses that make good money and are profitable due to high turnover.
"This is not a tax we can reasonably accept. A lot of tensions will ensue in the system," the EY official further said.
In his turn, Tax Executive Director Andra Casu showed that such a measure cannot get through the European Commission, because it resembles very much the VAT.
"Such a situation would prevent the enforcement of European directives. This project isn't meant to succeed. It has no chances to go through," Andra Casu underscored.