Since the interim Government that manages the public administration in Romania after the resignation of PM Marcel Ciolacu is not entitled by the law to endorse emergency ordinances, the restrictive fiscal package expected by the European Commission under the Excessive Procedure (EPD) cannot be passed by the Romanian authorities. For this reason, the European Commission could freeze the disbursement of cohesion funds and the funds under the Resilience Facility, according to sources familiar with the matter within the Romanian Government, as quoted by Digi24.
Interim PM Cătălin Predoiu said that the minister of Investments and European Funds, Marcel Boloş, will meet EC officials in Brussels next week to discuss fiscal reform and the Resilience Facility. Boloş would present an update on this topic after his visit to Brussels, interim PM Predoiu promised, according to Digi24.
When endorsing the seven-year fiscal consolidation plan drafted by Romania at the end of November 2024, the European Commission requested a tax reform report, also pledged by Romania under the National Recovery and Resilience Plan (PNRR), by April 1, 2025. This report, based on the World Bank’s recommendations under the PNRR, must present two tax reform scenarios covering all aspects of taxation and social contributions. The European Commission’s recommendations mandated the implementation of tax measures by April 2025, but the political landscape could complicate this timeline.
Marcel Boloș was supposed to go to Brussels at the end of this week to renegotiate the PNRR (including the tax reform report). At the request of the Romanian Government, the discussions were postponed precisely because of the political crisis. The European Commission had requested the final version of the PNRR by the beginning of this month.
The Romanian Government reportedly hopes to negotiate a new deadline extension until a government with full powers is installed.
(Photo: Marian Vejcik/ Dreamstime)
iulian@romania-insider.com
