Finance Minister says he would like to see social contributions cut

In his first press conference after more than four months in office, Finance Minister Gheorghe Ialomiţianu announced he wanted Romania's financial situation midway through this year to allow for social contributions to be cut, with a VAT change being out of the question.

"I would like it if midway through this year, Romania's financial situation would allow for social contributions to be cut, considering the high labour cost. We have to examine the possibility of making these cuts. I would like this to happen firstly for the employers, in order to bring the informal sector to light and have more people hired."
Because of the high level of social contributions, which, together with the income tax amount to around half the salary, some companies prefer to find ways outside the law to pay their employees, which deprives the government of social, health insurance and unemployment contributions.
Ialomiţianu was for about one hour the target of journalists' quickfire questions. Although he did not ignore any question, the Minister failed to give clear answers to certain key issues.
The Minister announced the Finance Ministry had managed to fall within the budget deficit target negotiated with the IMF, with the fiscal imbalance reaching 33.6% RON (6.58% of GDP).
As for 2011, the Finance Ministry asked the IMF to allow for a higher deficit in the first two quarters in order for investments to be made, with the target requested for the first quarter being 8 billion RON. The budget deficit negotiated for 2011 is 4.4% of GDP, i.e. 24 billion RON.