According to documents seen by Ziarul Financiar, the Bocgovernment has two scenarios for cutting the income tax in 2011: 10or 12% . The revenue reduction is expected to be compensated for bythe fact that at least 40,000 jobs would surface.
The plan has however been rejected by some of the members of thecabinet for the time being, as well as by the National Bank. Thedecisive position will be that of president Traian Băsescu.
Facing increasingly harsh criticism from businesspeople, the Bocgovernment has drawn up a scenario of reducing the income tax to10% or 12%.
This would be the government's first move to regain trust ofbusiness people, who have been seriously affected by the VAT hikeand by the recent modifications brought to the Fiscal Code.
According to documents seen by Ziarul Financiar, were the incometax to be cut to 10%, revenues collected to the state budget wouldbe 3 billion RON (700 million-euro) lower, with 80,000 jobssurfacing, along with the social contributions and other taxesdue.
If the tax is cut to 12%, revenues would decline by only 600million RON (150 million euros), but only half as many jobs wouldsurface.
The government collected 5 billion euros from the income tax in2009, at a 16% rate.
The plan has however been rejected for the time being by some ofthe members of the cabinet, as well as by the National Bank. Thedecisive position will be that of president Traian Băsescu, who wasthe most eager advocate of cutting the income tax to 16% at the endof 2004. The decision is expected in October.
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