Mercedes-Benz Romania: The new amendments in tax law will negatively impact the car industry
Mercedes-Benz Romania, the local importer of Mercedes-Benz, smart, Jeep and Dodge, says the measures proposed by the Romanian Government bear high risks, as the economic structure is already under excessive pressure.
The draft tax law initiated by Romanian government is basically walling all the sectors of the car industry in Romania, said Michael Grewe, CEO and chairman of Mercedes-Benz Romania.
The non-deductibility of VAT for car acquisitions, limited tax liability for service expenses up to 30% and full non-deductibility of maintenance expenses are measures that could fuel long-term negative effects, both for local players and for tax collection by the state authorities. The potential weakening of auto maintenance and repair activity will most likely bear a negative social impact, by pushing up the unemployment rate.
Other consequences deriving from the amendments to the tax law will be the decrease of car sales, by shifting clients’ focus to solutions to dodge the legal tax framework.
The draft tax law initiated by Romanian government is basically walling all the sectors of the car industry in Romania, said Michael Grewe, CEO and chairman of Mercedes-Benz Romania.
The non-deductibility of VAT for car acquisitions, limited tax liability for service expenses up to 30% and full non-deductibility of maintenance expenses are measures that could fuel long-term negative effects, both for local players and for tax collection by the state authorities. The potential weakening of auto maintenance and repair activity will most likely bear a negative social impact, by pushing up the unemployment rate.
Other consequences deriving from the amendments to the tax law will be the decrease of car sales, by shifting clients’ focus to solutions to dodge the legal tax framework.