Regulation for applying the VAT Directive

A new EU Regulation has been published introducing clarifications for amendments to the VAT Directive that came into force on 1 January 2010.
The clarifications deal with (among others):
• the place of taxation for intra-community services;
• the status as taxable persons of the beneficiaries of services;
• the conditions under which a company is deemed to have a fixed establishment for VAT purposes.

The provisions of this Regulation enter into force on 1 July 2011 and are directly applicable to all Member States of the European Union. Please note that most of the amendments clarified by this Regulation have already been implemented into Romanian national law. See: Regulation no. 282/2011 laying down implementing measures for Directive 2006/112/EC on the common system of VAT published in the Official Journal of the European Union L77/23.03.2011

Amendment of the VAT refund procedure

An Order has been published introducing new rules regarding the refund of value added tax (“VAT”). The main amendments brought by this Order are:

• The reimbursement decision will be issued within five days of submitting the VAT return in the following situations:
- The VAT refundable amount is equal to RON 10,000 or lower;
- The VAT returns are considered to be of low fiscal risk;
- The amount requested at reimbursement does not exceed the value of the Negative Individual Standard.

• The conditions for applying the special procedure of VAT reimbursement for exporters was modified as follows:

- The value of the export operations and intra-community supplies should represent 60% of the client’s account (previously 75%);
- The minimum value of export operations and intra-community supplies should exceed EUR 500,000 (previously EUR 1,000,000).

• The tax inspection for large and medium taxpayers will be performed within four years of the reimbursement being approved (previously 2 years).

• In cases of annulment of the VAT number, all the negative VAT amounts, irrespective of their value, will be reimbursed in accordance with the general procedure stipulated by the law.

The Order is applicable starting with the VAT returns related to April 2011.
See: Order no. 2017/2011 issued by the Ministry of Public Finance published in the Official Gazette of Romania no. 362/24.05.2011