Romania: Changes to construction tax

Emergency Ordinance no. 21/2025 (April 4, 2025) introduces changes to the construction tax, also known as the “pillar tax.” The ordinance's provisions are effective from the date of publication and apply starting with the fiscal year 2025. Key amendments include:

• Construction tax: The ordinance includes a reduction in the annual construction tax rate from 1% to 0.5% on the net value of constructions not already taxed locally. A reduced rate of 0.25% applies to constructions under management, concession, or lease contracts within public or private domains. Constructions located in Romania's territorial sea are exempt from this tax.
• Clarifications: The ordinance also provides clarifications on calculating the net value of constructions and specifies that certain investments are not considered constructions. Exemptions applicable to the building tax under Title IX of the Fiscal Code are also applicable to the construction tax.
• Establishment/cessation: For taxpayers that cease operations during the fiscal year, the construction tax must be recalculated proportionally. Newly established taxpayers are required to pay construction tax from their year of establishment, based on constructions owned 30 days post-registration.
• Discount: Taxpayers must declare and pay the construction tax by May 25 to receive a 10% discount, with payments due in two installments by June 30 and October 31, or according to the modified fiscal year's schedule.

Read an April 2025 report prepared by the KPMG member firm in Romania