Starting January 1, 2025, a series of legislative changes have come into effect, significantly impacting the calculation of salaries and related taxes. These amendments, introduced through Government Emergency Ordinance No. 156 and published in the Official Gazette No. 1334 on December 31, 2024, provide clarifications and essential adjustments for employers and employees.
Key Provisions
- Elimination of Tax Exemptions for IT and Construction Sectors
- IT Sector: Individuals earning income from salaries and salary-equivalent income for software development activities will no longer benefit from income tax exemptions or the 4.75% reduction in the social security contribution (CAS) for gross monthly earnings up to 10,000 lei.
- Construction Sector: Employees in this sector will also lose income tax exemptions and the CAS rate reduction for the same income thresholds.
- Setting Minimum Gross Wages for Specific Sectors
- Construction Sector: The guaranteed gross minimum wage in this sector is set at 4,582 lei per month (27.714 lei/hour), excluding bonuses and other additional payments.
- Agricultural Sector and Food Industry: The guaranteed gross minimum wage is set at 4,050 lei per month (24.496 lei/hour), also excluding additional benefits.
- Regulations on Non-Taxable Income
Employees working under individual employment contracts are eligible for a 300 lei/month non-taxable amount, provided the following cumulative conditions are met:
- The gross monthly salary is equal to the guaranteed gross minimum wage, excluding bonuses.
- The gross monthly income, excluding meal vouchers or other benefits, does not exceed 4,300 lei.
This condition is void if the gross salary is reduced before the end of 2025.
- Minimum Social Contributions
Social contributions owed by individuals (CAS and health insurance contributions, CASS) cannot be lower than the amount calculated based on the gross national minimum wage for the number of working days. Exceptions include:
- Students and pupils under the age of 26.
- Apprentices under the age of 18.
- Persons with disabilities.
- Retirees receiving public pensions.
- Individuals with multiple employment contracts whose total income exceeds the gross minimum wage.
Recommendations for Employers and Employees
Given the impact of these legislative changes on salary costs and tax obligations, we recommend the following steps:
- Professional Consultancy: Seek professional advice to fully understand the new regulations and conduct simulations to assess their impact on salary costs.
- Updating Contracts: Review individual employment contracts to ensure compliance with the new provisions.
- Financial Planning: Analyze the impact of the new contributions on budgets and operational costs.
For additional questions or specific cases, our tax consultancy team is at your disposal. Ensure you adapt promptly to these legislative changes to avoid potential penalties and non-compliance issues.
Author : Ana-Maria Radu
Our team of professional is available for any clarifications or additional details required in your analysis. The above information represents just a summary of aspects we consider relevant in the recently published legislation. This is not exhaustive disclosure of information and it is not intended to be used as advice on any particular matter. We invite all readers to contact us for further clarification of any specific issue. Argus Audit team and its associates disclaim liability in any action taken by a third party in reliance exclusively on summarized information presented in our publications.