„WELL TEMPERED" VAT - BETWEEN THEORY AND PRACTICE

VAT represents an indirect tax due to the state budget that includes all phases of the economic circuit, namely manufacturing, services and distribution, up to sales to final consumers. VAT collection is done fractionally, according to the value added at each stage of the economic circuit. Introduced in our country in 1993, VAT has been continuously improved and since Romania has been a member of the European Union (EU) since 2007, WATT has been harmonized with the European Community directives. Today, Romania encounters serious difficulties in collecting the VAT, being atop of the countries with tax arrears. This is why it is required a more effective collaboration between the parliament, which adopts laws, the government, that implements and business environment, where the added value is obtained, in order to achieve a more efficient and robust VAT system against fraud that can contribute to fiscal consolidation by increasing public budget revenues.