Moldovan cabinet turns down initiative of cutting quotas of excise duties on fuel by 50 per cent

Chisinau, 11 July /MOLDPRES/ - The cabinet of ministers today gave a negative notification to a draft law on the amendment of some articles of the Fiscal Code – a draft presented as legislative initiative, which provides for a 50-per cent cut of quotas of excise duties on fuel.   

Under the law on public money and budgetary and fiscal responsibilities, during the 2018 budgetary year, decision-makers cannot enforce decisions leading to the cutting of revenues and /or increasing of budgetary spending, if their financial impact is not provided for in the budget, Finance Minister Octavian Armasu has said.  

The commitments taken within the Association Agreement between Moldova and the European Union on the transposition of the EU’s Directives in the excise duties sector, especially the Directive 2003/96/CE of the Council from 27 October 2003 on the restructuring of the EU framework of taxation of energy products and electricity, stayed at the basis of the fiscal and customs policy, as component part of the medium-term budgetary framework (2018-2020).

At the same time, the law on the amendment and completion of legislative acts, adopted in mid-December 2017, on the fiscal policy for 2018, implies the levying of excise duties for a period of three years. The Finance Ministry said that the sources proposed for covering the budget deficit (increasing the volume of sales of goods on which excise duties were levied and enhancement of the efficiency of management of this sector) “are not real and cannot be regarded as plausible for the acceptance of cutting the budgetary revenues.”  

If the quotas of excise duties on oil products are reduced by 50 per cent, the losses related to the budgetary revenues would be of about 600 million lei in the second half of 2018, 1.250 billion lei in 2019, and respectively, 1.4 billion lei in 2020. The Finance Ministry also said that the developments of the prices in the last five months had not been influenced by the size of the excise duties, but by other factors, especially the evolution of the international quotations for oil products.

(Reporter V. Bercu, editor A. Raileanu)