Is requiring financial disclosure statement from every Romanian justified?

The introduction of a personal financial disclosure statement may be necessary in order to facilitate the application of the new regulations on levying tax on undeclared individual income, but if all Romanians were required to submit such a statement, this would create an “administrative nightmare”, tax consultants say.

On the other hand, were such a statement introduced only for certain people, it would be unconstitutional and discriminatory, say lawyers.

Anyway, experts in the field say the tax authorities cannot check wealth accumulated prior to 2011, so this would lead to a sort of tax amnesty for owners of big fortunes built from undeclared income.

The Government decided at the end of last year that individuals whose real incomes exceed the amounts declared by at least 50,000 lei, would pay a 16% tax levied on the difference between the two amounts. The tax authorities intend to check if a high earner’s spending is covered by their income.

“The personal financial disclosure statement can be an important element in the enforcement of those legal provisions, but, considering that more than 90% of Romania’s population will not be targeted by such investigations, I don’t see why it should be submitted by everybody,” comments Gabriel Sincu, partner at Mazars advisory and audit firm.