Finance Ministry lets brokers withhold tax on stock exchange gains

Stock Exchange investors will no longer have to submit quarterly statements on generated gains, but only annual ones, and the calculation, withholding and transfer of taxes on gains from transactions representing early payments will become the task of brokerages, according to a new Fiscal Code modification draft.

The Finance Ministry has come to the conclusion that the obligations of file tax returns and paying the tax every quarter did nothing but complicate fiscal administration and raise associated costs, and on the other hand are dampening capital market investments. Moreover, the ministry has identified “technical difficulties” in applying the current stipulations in the fiscal field.
Incomes/losses related to the period between July 1 and the date modifications come into effect are declared only in the annual tax statement and will be taken into account when setting the annual tax owed for the July 1, 2010-December 31, 2010 period. No early payments are due in the annual tax account for the gains related to the respective period, and after the new rules have been passed in the Government, withholding at source, namely by the broker, will be applied.