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Romania gives Ukraine opportunity to become leader in IT sphere

Author : Vyacheslav Cherkashyn

Source : 112 Ukraine

Not only the Ukrainian government was concerned about the "modesty" of taxation of the most dynamic sector of the economy. Ten days ago, the new Romanian Prime Minister, Ludovic Orban (he took office less than three months ago) made a statement that the IT employee benefit could be abolished
23:37, 29 January 2020

112 Agency

“We have a fixed tax rate of 10%. It's not very high, and I don’t think the world would end if everyone had to pay. I don’t think this is true for 7 million other people who owe to pay income tax, especially since, in my opinion, there are no more reasonable reasons to continue to offer these tax benefits," Orban said.

Let me remind you that since 2003, IT specialists in Romania, subject to a number of conditions (such as having a degree in the relevant field), used the zero tax rate on personal income. The above made the Romanian tax regime the most competitive in Europe (along with the Belarusian and Ukrainian). According to the latest data, the sector accounts for 6% of the country's GDP.

According to rough estimates, the initiative will affect about 30 000 people (100 000 work in this industry today), despite the fact that their average salary is 1560 euros per month.

For Ukraine, it means a window of opportunity for the acquisition of undisputed European leadership in the IT industry, although for this:

- firstly, our economic authorities should convincingly abandon any plans and intentions to increase the tax burden on the industry;

- secondly, to seriously work to simplify the business environment (reporting, administration and tax payment procedures), including immigration to Ukraine and the employment of foreign citizens;

- thirdly, to "adopt" specialists who want to leave for us from the same Romania, and offer (for all of them) similar conditions for taxation of wages.

“The point is not that we do not have a chance, but that we miss it over and over again” (Tibor Fisher).

Related: Three scenarios of Ukrainian IT industry

Related: EU evaluation mission on industrial visa waiver to visit Ukraine, - PM Honcharuk

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