October 6 (SeeNews) - Romania's Finance Minister Gheorghe Pogea said the government may consider raising the Value Added Tax (VAT) next year if there is risk for budget deficit to exceed the 5.9% target agreed with the IMF, news agency Mediafax reported on Tuesday.
"We can take into consideration a revenue reform, because Romania has one of the lowest levels of public revenue as share of GDP, of around 31.8%," Mediafax quoted Pogea as saying.
He added that in case of a revenue reform the government will keep the 16% flat income and profit tax but could consider raising the VAT, which stands at 19% now.
"We will see if the budget deficit we have agreed upon is sustainable with the current revenues and taxation level. We believe that we will manage to apply other cost-cutting measures and to keep the 5.9% deficit target that we have assumed," Pogea said.
Earlier this week, Romania's President Traian Basescu told a meeting with foreign investors that the VAT could be increased in 2010, Mediafax reported.
Romania's government in August raised its budget deficit forecast for the current year to 7.3% of GDP from 4.6% forecast earlier to match the projections made in the country's 20 billion euro ($29.5 billion) bailout package with the IMF, the European Union and the World Bank signed in late March.