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ArticlesJune 25, 20240

Amendment of law no. 241/2005: measures to combat tax evasion

Law No. 126 of May 10, 2024, regarding measures to strengthen the capacity to combat tax evasion, as well as to amend and supplement some normative acts, has notably modified Law No. 241/2005 on the prevention and combating of tax evasion.

One of the most significant changes is the criminalization of the non-withholding of taxes and contributions at source, thus expanding the scope of actions covered by the criminal law provisions relating to the offense of tax evasion.

Therefore, Law No. 241/2005 has been amended by introducing a new paragraph, Article 6^1, after paragraph 1, specifically paragraph (1^1), which reads:
(1^1) It constitutes an offense and is punishable by imprisonment from one year to five years or by a fine for the non-withholding of taxes and/or contributions specified in the annex to this law.

The taxes and contributions covered under Article 6^1 include:

1. Tax on dividends paid by a Romanian legal entity to another Romanian legal entity
2. Tax on incomes from independent activities carried out based on sports activity contracts
3. Tax on incomes from intellectual property rights
4. Income tax on salaries and similar earnings
5. Tax on income from leasing
6. Tax on interest income
7. Tax on taxable incomes obtained from the liquidation of a legal entity or from the reduction of the share capital, according to the law
8. Tax on dividend income
9. Tax on pension incomes
10. Tax on incomes from prizes and gambling
11. Tax on incomes from other sources
12. Tax on incomes obtained by a natural person from an association with a legal entity, taxpayer according to Title II of Law No. 227/2015, with subsequent amendments and completions
13. Tax on incomes obtained by a natural person or entity – association without legal personality from an association with a legal entity, taxpayer according to Law No. 170/2016 regarding the specific tax, with amendments and completions
14. Tax on incomes obtained by a natural person from an association with a legal entity, taxpayer according to Title III of Law No. 227/2015 with amendments and completions
15. Social insurance contribution
16. Health insurance contribution
17. Withholding tax on incomes obtained from Romania by non-residents
18. Tax owed on income from the transfer of real estate properties from personal assets
19. Contribution to the Environmental Fund

Previously, only the actions of withholding or collecting and not paying, within no more than 60 days from the due date, the taxes and contributions listed above were criminalized. The act can also be punished with imprisonment from one year to five years or with a fine.

Other changes provided by Law No. 126/2024 include:

  • Clear criminalization of false reporting in the e-Invoice system and the malicious use of it to create the appearance of legality of fictitious operations or to disguise the real transactional circuit of goods/services;
  • Criminalization of the use of cash registers not connected to the Fiscal System or the alteration of such devices for not transmitting certain fiscal data or for transmitting unreal fiscal data;
  • Punishment (including attempts) with imprisonment between seven and 15 years and prohibition of exercising certain rights for any action committed within fraudulent schemes that result in reducing the state budget resources by at least one million euros through various acts of bad faith, whose purpose is to evade the applicable legal norms regarding VAT;
  • Punishment with imprisonment between three and ten years and prohibition of certain rights or with a criminal fine for the lending operation carried out directly or indirectly by any natural person, aiming at making payments with sums of money that come from the omission of recording in the accounting documents the commercial operations performed and/or the incomes realized – by one or more taxpayers;
  • Amendments regarding the statute of limitations for offenses provided by the tax evasion law – the term of the statute of limitations for criminal liability starts from the date of notification of the fiscal body or from the date of notification of the criminal investigation body, but no later than ten years from the date of committing the offense.

For further information or any additional inquiries, please do not hesitate to contact us:

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Denisa Croitoru

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