Romania proceeds with plans for a pilot of Standard Audit File for Tax (SAF-T) for large taxpayers in January 2020.
The Romanian tax authorities often look to their Polish counterparts for guidance on introducing new tax legislation and reporting guidelines. Therefore, it’s no surprise to see them follow suit in announcing plans for the adoption of SAF-T.
Poland is one of the countries that managed to lower their VAT gap considerably. The 2019 report indicates that in 2015 the VAT gap as a percent of VTTL in Poland was 24%. In 2016 SAF-T reporting was introduced in Poland. This measure, along with others, has been credited as being the main driver for a reduction of the VAT gap in Poland to 20% in 2016 and 14% in 2017. This impressive performance may be a reason why the Romanian government is considering SAF-T. The European Commission’s report on the VAT gap puts Romania’s VAT gap at a staggering 36% in 2017, the highest percentage in the European Union.
It is worth mentioning Romania already have the 394 Declaration form, which is very similar to the SAF-T but with slightly fewer reporting requirements, so the likelihood is that this will be gradually replaced by the SAF-T.
However, at this stage, it is only a pilot scheme for large businesses which is due to commence in January 2020, with elections due to take in 2020, there is always a chance these plans could be scrapped or delayed.
For further information, please contact our VAT experts.