Taxation of Small Companies in Romania: From Competitive Advantage to Structural Pressure

Taxation of Small Companies in Romania: From Competitive Advantage to Structural Pressure

The taxation framework applicable to small companies in Romania is undergoing a profound recalibration, marked by successive measures that redefine the balance between supporting entrepreneurship and increasing budget revenues. These changes should no longer be viewed as isolated adjustments, but rather as a structural shift in the fiscal paradigm affecting SMEs.

Reconfiguration of the Microenterprise Regime

One of the most significant legislative changes concerns the restriction of access to the microenterprise taxation regime. Starting in 2026, the annual revenue threshold is reduced to EUR 100,000, following a prior decrease to EUR 250,000 in 2025.

The implications are immediate and substantial:

• a significant number of companies will exit the microenterprise regime
• exceeding the threshold triggers an automatic transition to corporate income tax (16%)
• eligibility continues to be assessed based on revenues recorded at the end of the previous financial year.

For sectors such as trade, services, and transport, the new threshold becomes increasingly difficult to maintain, accelerating the shift toward profit taxation and increasing fiscal complexity.

Accelerated Increase in Dividend Taxation

At the same time, the taxation of distributed profits has undergone a substantial transformation. The dividend tax rate has evolved rapidly:

• 5% → 8% (2023)
• 8% → 10% (2025)
• 16% starting in 2026

This dynamic significantly reduces the attractiveness of traditional entrepreneurial remuneration structures and directly impacts the net return on investment.

Adjustments in the Treatment of Fixed Assets

The only measure with a simplifying effect is the increase in the threshold for classifying assets as fixed assets, now set at RON 5,000.

This allows:

• simplification of accounting records for low-value assets
• immediate deductibility of certain expenses that previously required depreciation.

However, the positive impact remains limited and does not offset the broader increase in fiscal pressure.

Cumulative Impact on the Entrepreneurial Environment

Taken together, these changes generate a clear cumulative effect:

• reduced access to the microenterprise regime
• increased cost of profit distribution
• higher overall tax burden for entrepreneurs.

In practice, many small companies will operate under a tax framework comparable to that of large corporations, without benefiting from the same financial capacity or optimization tools.

GESEIDL Perspective

From the perspective of GESEIDL consultants, the current fiscal context requires a strategic repositioning of companies, both fiscally and financially. The focus is no longer solely on compliance, but on adaptation.

Key directions include:

1. Reassessing tax positioning Companies must model realistic revenue scenarios and anticipate the impact of transitioning to corporate income tax.

2. Optimizing dividend policy The timing of profit distribution becomes a critical tool for managing cash flow and tax exposure.

3. Restructuring investment approaches The new RON 5,000 threshold can be leveraged to streamline the accounting treatment of recurring acquisitions.

4. Reviewing group structures Entrepreneurs operating through multiple entities must carefully assess the implications of related-party rules on tax classification.

Conclusion

The current fiscal environment marks a transition from a favorable microenterprise regime to a more restrictive and uniform system. In this context, tax planning becomes an essential management tool, and decisions regarding business structure must be made proactively.

Adaptation is no longer optional. It is a prerequisite for maintaining competitiveness.