May 24 (SeeNews) - The European Commission said that Romania needs to correct and prevent a possible widening of its budget deficit, to carry out thorough social inclusion reforms and to increase predictability of decision during 2018 and 2019.
Overall significant further measures will be needed as of 2018 to comply with the provisions of the Stability and Growth Pact, in light of a strongly deteriorating fiscal outlook, the Commission said in its 2018 country-specific recommendations on Romania, a part of the European Semester Spring 2018 Package unveiled on Wednesday.
Romania's consolidated budget for January-March showed a deficit of 0.48% of the country's gross domestic product (GDP) projected for 2018, compared to a surplus of 0.19% of GDP a year earlier, the latest figures from the country's finance ministry show. Romania targets a consolidated budget gap of 2.96% of GDP on a cash basis in 2018, below the 3% EU ceiling.
The Commission also said that in the past year, Romania has achieved limited progress in addressing the repeated country-specific recommendation to strengthen tax compliance and collection. An example of of this is the value added tax, where the difference between theoretically expected and actually collected revenues remains very high. To improve compliance, the authorities introduced split payments, but according to the Commission, the measure has yet to deliver significant results.
Moreover, the introduction of electronic cash registers connected to the tax administration’s information technology system is still pending
implementation.
The second recommendation for Romania for 2018-2019 is to complete the minimum inclusion income reform. This also includes he improvement of social dialogue, access to healthcare and increasing quality of mainstream education, in particular for Roma and children in rural area, the Commission stressed.
Finally, the Commission recommended that Romania increase the predictability of decision-making by enforcing the systematic and effective use of regulatory impact assessment and stakeholder consultation and involvement in the design and implementation of reforms.
Also, the country needs to improve the preparation and prioritization of large infrastructure projects and accelerate their implementation, particularly in the transport, waste and waste water sectors.
Romania needs to work also on improving the transparency and efficiency of public procurement and on strengthening the corporate governance of state-owned enterprises, the Commission recommended.
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