Parliament/Budget commissions meet IMF representatives

Members of parliamentary budget-finance commisions met on Tuesday IMF representatives, who are in Romania for the annual analysis of Romanian economy. The Save Romania Union (USR- opposition) deputy Claudiu Nasui mentioned that the IMF team insisted on two big problems: rising expenses and the low participation rate of the population to the working force.   Claudiu Nasui pointed out that the IMF visit was scheduled, and there was not a crisis situation: “The two big problems are: the question of budget deficit, which they pointed out every time. We mentioned rising expenses and they agreed. Romania's problem is not necessarily that of incomes which had risen, although IMF would like higher incomes, but it is the question of expenses which have exploded. That aspect is also found in figures and they aware of it” .   He mentioned that the second question concerns the low participation rate of the people to the work force. “The second problem is a new one which they did not mention before. I was a member of the Budget Finance Commission at every meeting with them and it is the first time when they mentioned that. We have the second lowest participation rate of the people to the working force. That means there are many Romanians who do not work. Here we have a double problem: firstly because many people go abroad, we are a fantastic labor force exporter in Europe, but there are also Romanians in the country who do not participate to the labor force in a sufficiently high percentage.”the USR deputy said.   Nasui showed that IMF did not offer solutions, but rather pointed to those problems. “The labor force left. We have low unemployment and we even import labor force and have a labor force shortage as we export labor force. We can study the Fiscal Code and see that Romania has the highest taxes on low salaries of the entire Europe. It is an aspect that even Mr Ciolacu mentioned and about which we have tried to find solutions. Let's tax the lowest salaries less, zero taxes on lowest salaries is a measures we advanced and is supported and we sould back the government to do something about it,” Nasui explained and mentioned that if IMF had emphasized that problem it was an alarm signal.”   According to Nasui, the fiscal measure package seems to be accepted by IMF. “They seem to agree to that, alhtough they did not mention it. In exchange, they were clear that measures of making expenses more efficient will not lead to curbing expenses. Practically, what IMF says is they do not think that reducing expenses will take place and they consider increasing taxes as a solution to solving the question of deficit,” the USR deputy added.   Th liberal (PNL) deputy Dan Vilceanu said in his turn that IMF recommendations involved paying attention to the efficiency of budget expenses. “The topics discussed concerned the situation of Romanian economy, the fiscal package we are talking about. Obviously, IMF comes to Romania every year for this monitoring mission, which takes place in all IMF member states and we talk about the economic situation, about the way in which they see the evolution of things. They paid attention to the vocabulary they used, that we should pay attention to the efficiency of budget expenses,” Vilceanu showed.   According to him, some measures from the fiscal package promoted by the government were expected by many and mentioned in that respect the elimination of exempting some taxes. He added that IMF did not analyse, but said that those exemption should have been eliminated a long time before and there were also shortcomings in the taxing system.“IMF does not criticize or praize, it just states a neutral point of view,”Vilceanu added.   An IMF team, headed by Jan Kees Martjin, the head of the mission for Romania is in Bucharest over September 25- October 4, 2023, for the annual analysis of Romanian economy.