Approval of tax and customs legislation amendments

August 2023

In brief

Various laws have been published which significantly amend the tax, customs and other normative acts.

In detail

Income tax

Individual taxation

The list of benefits in kind that can be granted by employers to their employees has been revised. From 2024 onwards, the following payments and expenses incurred on behalf of employees will not be considered as benefits in kind:

The value of gifts in kind, including vouchers given to employees and their minor children on the occasion of non-working holidays according to the Labour Code and on employee birthdays, of which the amount does not exceed 10% of the national average monthly salary, as per the government-approved forecast.
Employee training, other than that permitted by law, and activities related to strengthening corporate culture and team spirit.
Subscriptions for the use of sports facilities for the practice of sports and physical education for maintenance, prophylactic or therapeutic purposes offered by the providers of sports clubs and fitness centres, in an amount of up to 50% of the national average monthly salary, as per the government-approved forecast.
The contracting of medical services in an amount of the national average monthly salary, as per the government-approved forecast.
Payments of expenses incurred and determined for the transport of and food for trainees and/or students, up to the limit determined by the government.
The costs of employees’ supplementary health insurance in the amount of the national average monthly salary, as per the government-approved forecast, for each employee.
The amounts of payments made on behalf of employees for the purpose of compensating the costs of childcare services for their children up to the age of three, without exceeding MDL 2,500 per month for each child.

The composition of non-taxable sources of income has also been completed with:

the above-mentioned incomes obtained by individuals within the limits set by the legislation;
income obtained by individuals from the disposal of iron and non-iron waste, industrial residues containing metals or alloys and returnable packaging.

Individuals will be entitled to deduct the following expenses when determining their taxable income:

Amounts for mandatory health insurance contributions.
Amounts for mandatory social security contributions.
Premiums for supplementary health insurance or expenses for contracting medical services from a single provider of such services up to the amount of the national average monthly salary forecast for that year and under certain conditions.
Amounts paid for the purchase of insurance premiums under a life insurance contract, up to the amount of the national average monthly salary forecast for the year in question.
Amounts paid for mortgage loans, for the purchase of the first home, other than those contracted under the “Prima Casa” (“First Home” in English) state programme, in the amount of a national average monthly wage for the year in question.

Deductible expenses

As of 1 January 2024, employers will be entitled to deduct additional expenses as well as:

payments and expenses incurred by the employer for the benefit of the employee within the limits established by the legislation (please refer to the above list);
donations for philanthropic or sponsorship purposes to trade unions and employer organisations up to 5% of the taxable income.

Capital gains and losses

Capital gain or loss will not be recognised in the case of:

redistribution (transmission) of property between spouses or former spouses if this results from the need to divide the mutual property in the event of divorce;
redemption and/or exchange of debt securities and bonds by their issuers;
redemption and/or exchange of government securities by the Ministry of Finance or primary dealers in accordance with the law;
the exercising of the right, as provided for in the option, to buy or sell equity assets and/or convert options.

Tax regime of small and medium sized enterprises

Shareholders of companies classified as small or medium-sized enterprises which hold more than 25% of the value or number of shares or voting rights in more than three small and medium-sized enterprises must determine for which company the general tax regime (i.e. 12%) should be applied.

The tax regime in the field of commercialisation of iron and non-iron waste

As of 2024, a new tax regime will be introduced into the Tax Code for companies licensed to collect, store, process, trade or export iron and non-iron scrap and waste metals, batteries and spent accumulators. The subject of taxation will be the income determined according to financial accounting, except for exchange rate differences, which will be taxed at 7%.

Withholding tax

This will not be withheld in advance as part of the income tax on the disposal of shares, bonds or other property titles in entrepreneurial activity.

Final withholding of income tax at source of payment

Banks, savings and loan associations and issuers of debt securities and bonds will withhold a 6% tax from interest paid to resident individuals.

The Ministry of Finance or primary dealers will also withhold a tax of 6% from interest income earned by individuals from government securities.

Value added tax (VAT)

VAT rates

The VAT rate for hotels, restaurants and cafes will be decreased from 12% to 8% as of 10 August 2023.

From 2026, cars and other vehicles will be taxed at the standard VAT rate of 20%.

Construction and assembly work on renewable energy power plants will be considered as VAT-exempt supplies without the right to deduct.

The calculation of VAT

The non-taxable VAT limit for the import of goods by individuals has been removed. In addition, individuals who, in the case of commercial transactions (business to consumer –B2C), introduce goods of a commercial nature via international postal consignments will pay VAT, irrespective of the value of the goods.

Special cases of issuing tax invoices

In the case of deliveries of goods paid for using business payment cards, when using e-invoices, the deadline for the supplier to issue a tax invoice is tenth calendar day of the month following that in which the delivery took place.

Excise duties

New regulations have been introduced for electronic cigarettes and tobacco products.
Individuals importing goods for their personal use or consumption or by international postal consignments where the goods are not of a commercial nature will pay excise duty on the full value of the goods.
A new excise duty calendar has been set for the period 2024 to 2026. From 2026, excise duty on vehicles will be abolished, except for the excise duty on luxury cars.

Tax administration

New rules on the procedure for lodging appeals against decisions issued by the State Tax Service have been introduced and will be implemented as of 10 August 2023.

Local Taxes

Individuals or individuals registered as entrepreneurs who place advertising information on means of transport will not be deemed to be subject to tax on the placement of advertising.

Broadcasters of messages of public interest will be exempt from paying the advertising (advertising) placement fee.

Mandatory state social security contributions

Expenses incurred and determined for the transport and food of trainees and/or students, as determined by the government, will not be subject to compulsory state social security contributions.

The amounts received in accordance with Article 24, paragraphs (19³) and (20) of the Tax Code No. 1163/1997, as well as the costs of alternative childcare services for children up to the age of three, up to an amount not exceeding MDL 2,500 per month for each child, will not be subject to compulsory state social security contributions.