Excise Duties

Last update: May, 2010

by PricewaterhouseCoopers

Harmonised Excisable Products

Scope

The following products are subject to harmonised excise duties: alcoholic beverages, tobacco products and energy products (e.g. unleaded petrol, electricity, coal).

Chargeability

Excise duties are due when the products are released for consumption (e.g. imported into Romania, taken out of an excise duty suspension regime).

Excise duty suspension arrangements

Excisable products can be produced, transformed, held and received under a duty suspension arrangement only in a tax warehouse, which should have prior approval from the tax authorities.
Such excisable products can also be received from within the EU under excise duty suspension arrangements by registered / non-registered traders.
Romanian tax warehouse keepers are deemed authorised for the intracommunity movement of excisable products under excise duty suspension arrangements.
Excisable products can also be dispatched under duty suspension arrangements after being released for free circulation by the registered consignor (this also applies for the holder of a single authorisation for a simplified customs clearance procedure).
The movement of these excisable products under a duty suspension arrangement has to be made based on the accompanying administrative document (AAD). From 1 April 2010 the paper AAD procedure will be replaced by the computerised system for monitoring the movement of excise goods under suspension of duty.
The production, holding and movement of excisable products under duty suspension arrangements are subject to a guarantee.

Exemptions

Ethyl alcohol and other alcoholic products are exempt from the payment of excise duties if they are denatured, used in nutritional, Pharmaceuticals or cosmetics industry. From 1 April 2010 there will be exemptions for ethyl alcohol and other alcoholic beverages when used in a manufacturing process provided that the final product does not contain alcohol or when used as samples for analysis, for necessary production tests, or for scientific purposes.
The excise duty exemption for alcohol products and energy products can in some cases be granted directly based on an end-user licence or indirectly through reimbursement/compensation.
Some energy products subject to movement control can be purchased to be used for the purposes excepted from excise duty, provided that an end-user authorisation is obtained and the payment of excise duties is secured.
From 1 April 2010 the guarantee required for movement under duty suspension arrangements may be lodged by the transporter or carrier, by the owner of excise goods or by the consignee; or jointly by two or more persons involved in the movement of the excise goods (e.g. the consignor and the transporter of the goods).

Excise duty reimbursement

In some cases, traders can claim a refund of the excise duties paid (e.g. excise duty paid for goods released for consumption in Romania, but intended for consumption in other Member States; excise duties paid for goods released for consumption and then returned to the production tax warehouse for recycling, reprocessing or destruction; excise duties paid for goods acquired from the EU or imported and then returned to the suppliers).

Special legal requirements

Before being released for consumption in Romania, spirit-based beverages and tobacco products have to be marked with duty stamps. The responsibility for such marking lies with the tax warehouse keepers, registered / non-registered traders and importers releasing such goods for consumption.
Companies selling fuel in gas stations have to register with the tax authorities.

Derogations

Following the negotiations for EU Accession, Romania was granted several derogations n the field of excise duties. For certain products (e.g. cigarettes, unleaded petrol, diesel, natural gas used for non-commercial purposes, burning oil used for urban heating, electricity for commercial and non-commercial purposes) Romania can apply transitional periods before reaching the minimum excise duty level set within the EU. The minimum excise duty level will be reached gradually.

Other Excisable Products

Scope

From 1 April 2010 the other excisable products are green coffee, roasted coffee (including coffee with substitutes) and soluble coffee (including blends with soluble coffee).
The excise duty for coffee will be gradually decreased to nil by 2011.

Chargeability

Excise duties are due when the actual receipt takes place, for the excisable products received from the EU.
For imports of excisable goods, the importers holding single European authorisations for simplified customs clearance procedures issued by another EU Member State have to file a VAT and Excise Duties declaration with the customs authorities. Excise duties will be due on the date the import declaration is registered.

Exemptions

Excise duty exemption applies in this case, provided the excisable products are exported or placed under a suspensive customs regime.
Companies performing exports or intracomunity supplies of coffee may benefit from the refund of the excise duty paid for the coffee used as raw materials.
Traders purchasing coffee are entitled to a refund of the excise duties paid, if the products are exported, supplied to another EU Member State or returned unchanged to the supplier.

Car Registration Tax

The specific pollution tax was tripled for some categories of vehicles. A tax exemption was introduced for vehicles registered for the first time in Romania or another EU country. This exemption applies for vehicles with EURO 4 pollution standard, and with a cylinder capacity not exceeding 2000 cm3.

Environmental Fund Contribution

In certain cases (e.g. packaging waste) the contribution to the Environmental Fund depends on the degree to which companies achieve the recovery / recycling targets stipulated by the relevant legislation on waste management. Thus, for packaging waste, the contribution to the Environmental Fund is currently RON 2 per kilo of packaging introduced onto the market and is owed for the difference between the recovery target stipulated by law and the percentage actually achieved by companies.
Companies conducting activities that result in the discharge of air-pollutant emissions from fixed sources (e.g. nitrogen oxides, sulphur oxides, persistent organic pollutants, heavy metal emissions, such as lead, cadmium, mercury) have to pay contributions to the Environmental Fund of between RON 0.02 / kg (about EUR 0.0046) and RON 20 / kg (about EUR 4.61).
Importers and producers of hazardous substances have to remit to the Environmental Fund a contribution of 2% of the value of the substances placed on the market (save for those used in the production of medicines). Companies selling ferrous and non-ferrous waste and companies dealing in wood or wood products also have to make contributions to the Environmental Fund, currently set at 3% and 1 %, respectively, of the revenues / sales value.
Companies that store recoverable waste (i.e. waste resulting from extraction and processing of crude oil, waste resulting from primary processing of wood, waste resulting from alcohol manufacturing, carboniferous slurry, furnace slag, ashes from thermal power plants, pyrites ashes, phosphogypsum, metal slag) on new plots of land have to pay tax to the Environmental Fund. This tax ranges from 0.2 RON (about EUR 0.046) per sq metre to 4 RON (about EUR 0.90) per sq metre and per year, depending on the type of waste stored on the new land.
Companies have to report and pay these taxes monthly, semi-annually or yearly - depending on the tax concerned - to the Environmental Fund Administration, by submitting a declaration.
Producers / importers / exporters of electrical and electronic equipment ("EEE") have to register with the National Agency for Environmental Protection. Failure to register can result in the suspension of company activity.
Producers / importers wishing to place batteries on the market are required to register with the National Agency for Environmental Protection.
Placement on the market of portable batteries containing more than 0.002% cadmium by weight is prohibited. Distributors are also prohibited from selling batteries originating from unregistered producers.
Companies which place carrier bags on the market not made of biodegradable materials have to pay a tax ("ecotax") of RON 0.2/ per bag.

Registration, Evaluation and Authorisation of Chemicals

Chemical substances and preparations traded on the market must be registered with the Ministry of Environment and Sustainable Development at the National Agency for Dangerous Substances and Chemical Preparations.
Registration is the only way for producers and importers of chemical substances to be allowed to continue production and import of chemical substances and preparations.