Tax Flash No. 11/2017

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Order n0. 2.856/2017 on setting criteria for evaluating fiscal risks in the case of registration for VAT purposes, for the approval of the Procedure regarding the evaluation of fiscal risk for taxable persons who request registration for value added tax purposes pursuant to art. 316 para. (1) letters a) and c) and para. (12) letter e) of Law 227/2015 on the Fiscal Code, for the approval of the Procedure for registration for value added tax purposes, upon request, pursuant to art. 316 para. (12) letters e) of Law 227/2015 on the Fiscal Code as well as for approval of the Annulment Procedure, ex officio, of registration for value added tax purposes of taxable persons who pose a high fiscal risk according to art. 316 para. (11) letter h) of Law 227/2015 on the Fiscal Code was published in the Official Gazette no.780/2017.

  • The Order contains the procedure regarding the assessment of the fiscal risk for companies set up in accordance with Companies Law no. 31/1990 requesting the registration for VAT purposes, as well as the procedure for the cancellation ex officio of the registration, respectively, the criteria considered for determining the fiscal risk.
  • The Order provides the criteria leading to a negative score out of which we mention the aspects related to headquarter, number of employees, fiscal residence, being shareholder/administrator of other taxable person which was insolvent/within a temporary lack of activity/fiscal inactivity/bankruptcy or had fiscal liabilities towards the state budget within the last 5 fiscal years, nature of administrators’ income etc.
  • The new Order does not specify the methods for assigning the score, but it is specified that the obtaining of a score lower than 51 points leads to the establishment of a high fiscal risk which triggers the rejection of the VAT registration request.
  • The Order is applicable to the requests filed as of October 2017.
  • The requests for VAT registration purposes with respect to which the procedure for the assessment of the intention and capacity of carrying out economic activities subject to VAT was not completed until the entry into force of the Order shall be solved based on the provisions in force at the date of the submission of these requests.

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