PROFIT TAX OR INCOME TAX? OPTIONS FOR FISCAL OPTIMIZATION OF ROMANIAN SMALL COMPANIES

Doina Pacurari

Studies and Scientific Researches. Economics Edition, 2013, issue 18

Abstract: Entrepreneurs usually seek for solutions to reduce their tax burden. We can speak about tax optimization as long as these solutions are in accordance with the law; if they are not, they obviously fall into the area of fiscal fraud. This paper addresses the issue of taxation applicable to the Romanian micro-enterprises. These are small entities that fulfil certain conditions regarding total turnover, equity and domain of activity. Although the provisions applying to micro-enterprise taxation were elaborated, among others, with the intention to reduce tax evasion, they also allow the micro-enterprises with losses to avoid tax payment. In a country with low purchasing power and a great number of taxes and fees like Romania, the entrepreneurs are tempted to use any kind of method to reduce the payments due to the state budget. The micro-enterprise owners make no exception in this matter.

Keywords: micro-enterprise; profit tax; income tax; tax evasion; fiscal optimization (search for similar items in EconPapers)
JEL-codes: G30 M10 (search for similar items in EconPapers)
Date: 2013
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Persistent link: https://EconPapers.repec.org/RePEc:bac:fsecub:13-18-24

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