Adrian Codirlașu: IRCC will decrease only in 2025 / We will have substantial tax increases from next year

The Central Bank will not cut interest rates in the first part of the year, but probably in the second part, unless there are other shocks to inflation. Thus, those who have credits linked to the IRCC and those who want new credits should take into account the fact that the IRCC will remain at the current level throughout 2024, says Adrian Codirlașu, vice-president of CFA Romania, invited to the podcast “You and the money

Money in the walletPhoto: Rochu2008 | Dreamstime.com

Only from 2025 will there be decreases in the index, says the economist. “Where does this gap come from? The IRCC reacts with two quarters to the movement of interest rates on the money market, so if the NBR cuts interest rates in the second part of next year, we will only have the IRCC drop in two more quarters. In other words, by the end of 2024 we will have an IRCC like now”, concludes Codirlasu.

We will have substantial tax increases, but not in 2024

In Adrian Codirlașu’s opinion, we will have substantial tax increases, but not in 2024 because there are elections and no one increases taxes during election periods. “Probably this increase in taxes will be put on the shoulders of the companies, and they will pay it and then they will raise the prices, so that the consumer will also pay. Direct taxes on the consumer will appear strongly from 2025. There is already talk of increasing the single rate, or introducing a progressive tax.

After the elections, the pressures from the European Commission will probably be extremely high and measures will have to be adopted to fit within the deficit targets, that is, we will have to somehow return to a sustainable fiscal policy. At the current moment, the fiscal policy is absolutely not sustainable and, in my opinion, it is even a risk to Romania’s rating”, says the economist.

By the way, the Minister of Finance, Marcel Boloș he didn’t make a secretfrom the fact that from 2025 tax changes are coming so hard, that the new taxes from 2024 will even seem light to us.

Marcel Boloș, the Minister of Finance, announced that from 2025 there will be a tax reform and that we will “miss the Law on Fiscal-Budgetary Measures”, i.e. Law 296/2023 for which the Ciolacu Government assumed responsibility: the avalanche of new taxes from 2024.

“These measures are transitional towards the true tax reform that we will probably have in 2025. Certainly, changes in 2024 are no longer in question, at least at the current moment. Not even for 2023”, said Marcel Boloș.

“The measures from 2025 will be sufficient as shown by the commitments made through the PNRR. Know that we will miss the Law on Fiscal-Budgetary Measures”.

“The impact of the minimum tax on turnover is estimated at almost 5 billion lei. It’s an important amount for the state budget and a transitory tax”, explained the Minister of Finance.

What is the reason for the fiscal reform in 2025: the new pensions and salaries of budget officers

“We rely on the fiscal reform that is a milestone in 2025. The substantial financial resources for the measures in the general pension law will come from the new fiscal reform,” said Boloș, during a conference organized by CursDeGuvernare.ro.

It is clear, he says, “that the foundations are being laid for a substantial fiscal reform to support these commitments that we had both through the pension law and through the single salary law.”

“They are laws with a consistent budget impact and they need consistent financial resources,” said Boloș.

Photo source: Rochu2008 | Dreamstime.com

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Barack
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