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Romania’s Personal Income Tax Changes and Their Impact on the Tech Sector

Diana Chitu

< 1 Min Read

In a bid to address various economic and social objectives, Romania has recently made significant changes to its personal income tax legislation.

In a bid to address various economic and social objectives, Romania has recently made significant changes to its personal income tax legislation. The changes aim to balance the tax burden across different income groups and sectors, ensuring a fairer distribution of tax responsibilities and supporting the national budget.

Key adjustments to be aware of:

  • Income Tax Adjustments: Romania has adjusted its income tax brackets, slightly increasing the tax-exempt threshold for low-income earners. This change is intended to reduce the tax burden on lower-income employees, giving them more disposable income. However, higher earners might see a marginal increase in their tax rates, contributing more to the national budget.
  • Tax Changes in the Tech Sector: From 2024, software company employees are no longer exempt from income tax on salaries, benefits, and bonuses exceeding 10,000 lei. The new tax amounts to 6.5% on the portion of salary above this threshold. Additionally, IT professionals are no longer required to contribute to Pillar 2 pensions for the first 10,000 lei of gross income unless they opt in via a written request to their employer.

If you would like to discuss how these changes affect your organisation, our experts are available to assist you in navigating the adjustments.

Diana Chitu

Head of Health & Benefits Department
GrECo Romania

T +420 735 175 613

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