Fiscal code and new contributions

Taxation Services
No. 14 / 3 May 2006

Fiscal Code Amendments

Certain amendments have been introduced on excise duty.

These mainly refer to:
- increase in excise on certain products (e.g. beer, ethyl alcohol, tobacco and certain mineral oils) starting from 2 May 2006 and/or 1 July 2006;
- part allocation of excise on ethyl alcohol and tobacco products for the public health system (Article XI of Law 95/2006), to be paid to the Ministry of Health;
- introduction of the concept of registered operator, defined as natural persons or legal entities entitled to receive excisable goods under a customs suspensive regime from authorised warehouses in EU member states;
- excise codes to be issued to persons authorised as warehouse holders, registered operators and fiscal warehouses. A subsequent Ministry of Finance Order is expected in this connection.

The above provisions enter into force on 2 May 2006.

(Emergency Ordinance 33/2006 published in the Official Gazette 374/2 May 2006)

New Contributions for Public Health System

New contributions have been introduced for producers and importers of tobacco products and alcoholic drinks, and companies involved in their advertising.

a) Producers and importers of tobacco products will contribute:

- EUR 10 per 1000 pieces on cigarettes;
- EUR 10 per 1000 pieces on cigars and cigarillos;
- EUR 13 per kilogram on smoking tobacco;

b) Producers/importers of alcoholic drinks other than beer, wine, other fermented beverages and intermediate products (mentioned in Law 571/2003) will pay EUR 200 per hectolitre of pure alcohol or EUR 2 per litre of pure alcohol;

c) Companies earning income from advertising for tobacco products and alcoholic drinks will contribute 12 % of such income (post VAT deduction).

These contributions must be paid monthly to the Ministry of Health in RON at the exchange rate used for computing the excise by the 25th of the following month.

The above provisions enter into force on 2 May 2006 except c) which enters into force on 1 January 2007 (until that date the provision of GO 22/1992 concerning the 12% contribution for the income from advertising for tobacco products, cigarettes and alcoholic drinks is still applicable).

(Law 95/2006 published in the Official Gazette 372/28 April 2006)

For additional information, please contact:
Venkatesh Srinivasan - Partner - Head of Tax Department