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How the reduced VAT rate in tourism will be applied

Written by: Bridgewest

How_the_reduced_VAT_rate_in_tourism_will_be_applied.jpgForeign business owners who want to invest in tourism in Romania will benefit from a reduced VAT rate for a number of new services. The Romanian government has recently approved a decision for the modification of the methodological norms of the Fiscal Code in order to make this change in the VAT rate for tourism companies. This measure is likely to encourage business owners to invest more in tourism and open new facilities and resorts in Romania's most beautiful and attractive touristic destinations.

Reduced VAT rate for accommodation services

 
The reduced VAT rate of 9% will be applied for business owners who provide accommodation services and other services related to accommodation and it is calculated according to the price of the tourism package. The list of other services associated with accommodation services includes: breakfast, lunch, dinner, snacks offered to the tourists within the package and other entertainment services that can be provided within the housing unit or its surroundings (supervised outdoor activities, special activities for children etc.)
 
The decrease of the VAT from 24% to 9% for accommodation services with or without all inclusive services was first negotiated with the representatives of the International Monetary Fund in December 2014.
 
Right now, the reduced rate only applies to simple accommodation services, when the cost of the breakfast is included in the accommodation price.

Tourism in Romania

 
Romania's natural beauty and picturesque landscapes make the country a good opportunity for investments in the tourism sector. Entrepreneurs can choose to invest in accommodation services or various entertainment facilities. Seaside and mountain resorts are equally popular although the rural beauty of the country seems to spark more interest in the foreign traveler.
 
Dental tourism is also widely practiced and increasingly popular in Romania. If you want to invest in Romania and need assistance for accounting matters, our accountants in Bucharest can help you with any problem.