ARTICLE · 25 OCTOBER 1996
Price Waterhouse Romania: Flash Report No.10:
RomaniaAccounting and Audit
As we advised in our recent Flash Report on VAT, the Romanian government has modified Art 8 of the VAT Ordinance and has confirmed the reverse charge concept. The Report also confirmed that the Government is attacking all foreign services payments for withholding tax.
According to the amended VAT Ordinance, where the legal person performing taxable operations does not have a registered office in Romania, it is compulsory for it to appoint a fiscal representative domiciled in Romania. This person undertakes to fulfill all VAT payment obligations.
It now appears that in June 1996, the President of the Central Commission for Unitary Enforcement of Legal Provisions in Indirect Taxes Field (we should use initials in future) issued an official explanation regarding the implementation of Art 8 of the VAT ordinance (this is referred to "Decision 8"). This decision has now been published in the Official Monitor and is likely to become the authoritative approach to reverse charge.
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