Government raises excises

Boosting budgetary revenues by raising excises, this is the first idea the Government came up with to contain the unprecedented import growth and cut the budget deficit. Until having to cut into next year’s projected spending, the Finance Ministry is trying to find options to boost revenues and implicitly put a lid on consumption of certain imported goods. “Import-based consumption induces inflationary pressure and puts a damper on economic growth,” PM Adrian Nastase at the end of last week said. He added people needed to be explained that economic modernisation had to be done in line with macroeconomic criteria, that certain economy segments could not be “overheated” and the import or consumption segment could not be increased. Under the circumstances, the Premier publicly brought forward the idea of increasing excises for the import of certain luxury products, which Finance minister Mihai Tanasescu did not care to detail, merely saying it was being considered. Luxury products, however, do not account for too much of the trade deficit ruled by the imports of energy and of components later found in exported products this fall. In addition, demand for such products is hardly sensitive to price increases, such as those caused by a rise in excises. ZF