Romania: the Government adopts a solution to maintain net wages for certain categories of tax exempt employees

In the Official Gazette of Romania no. 125/08.02.2017, the Emergency Ordinance no. 3/2018 on certain fiscal budgetary measures was published.

We list below the main amendments included in the Emergency Ordinance 3/2018.

• The Ordinance introduces a mechanism whereby part of the health insurance contribution due by employees exempt from personal income tax is borne by the state so that the net salaries of said individuals do not change as a result of the transfer of contributions from the employer to the employee; the incentive applies in 2018 to employees benefiting from personal income tax exemption (i.e. individuals with severe disabilities, individuals carrying out software development or research & development and innovation activities, individuals undergoing seasonal activities) whose labour/posting contracts were ongoing on 31 December 2017 and whose monthly gross wages were increased by at least 20% in 2018 compared to December 2017.
• For part-time employees, the obligation to bear the difference between the social security contributions applied to the actual gross income and the social security contributions applied to the national gross minimum wage is shifted to the employer.