23 August 2016

The avoidance of VAT purposes registration

What does the Fiscal Code provide?

The New Fiscal Cod assignes to the responsible fiscal authorities the avoidance of VAT purposes registration for legal persons.

The case that interests us is the one stipulated by art. 316 alin. 11 lit. h) which sets out the possibility of avoidance for VAT purposes registration in the case of persons subject to tax that do not justify the intention and capacity to unfold economical activities according to the criteria and in the time frame regulated by the Order of the ANAF President.

What are the old regulations?

According to Order 3331 from 17 October 2013, the ex officio avoidance was effective starting with the date when the decision of the fiscal authority had been received. Starting with the same date the VAT purposes registration certificate was also avoided.

We observe that the Order was in contradiction with the regulations of the new Fiscal Code because there was no mention of the criteria that the person subject to tax should have complied with in order to justify the intention and capacity to unfold economical activities for VAT purposes, and the person subject to tax did not have the possibility to present its own point of view regarding the decision of the fiscal authority.

What changes do the new regulations bring?

On 12 August 2016, the ANAF President issued Order 2393. This Order stipulates for the first time the criteria according to which the intention and the capacity to unfold economical activities for VAT purposes of the persons subject to tax are established.

These criteria are the following:

i. The person subject to tax is not in the situation to not unfold economical activities in the space dedicated to the registered office and/or secondary offices and also not outside those. In order to evaluate this criterion, the person subject to tax has to file a staturoy declaration.

ii. The administrators, associates and/or the legal person do not have any of the infractions specified by the Order written in their tax records.

iii. The intention and capacity to unfold economical activities that involve operations subject to tax and/or exempted from VAT with deduction rights. This evaluation is made based on the statutory declaration filed by the person subject to tax, respectively Form 088. Following the evaluation, the person will come under one risk category: high, medium or low.

Another change that is essential for the tax-payers is the insertion of the obligation of the fiscal authority, in certain cases, to invite to its office the legal representative of the person subject to tax. The purpose was, according to the ANAF President, to facillitate the communication between the business environment and the fiscal authorities.

The situations when the legal representative is invited to the fiscal authority’s office are:

i. The case when the legal persons that have not filed Form 088 automatically come under the fiscal risk category.

ii. The case when the persons that are automatically selected monthly and present fiscal risk, following the evaluation, are notified to file Form 088.

iii. The case when the persons, following the evaluation, partially fit the criteria and come under the medium risk category.


These changes represent an evolution regarding the transparency of ANAF decisions and the protection of the right to defend oneself, the tax-payers having the possibility of a clarification meeting that is ahead of a decision to reject the request or to avoid the VAT purposes registration. During this meeting, the legal person can bring clarifications or it can express a point of view and evaluation compartment of the fiscal authority has the obligation to analyze it.

Moreover, in the Approval Paper of the Order’s Project it is claimed that these changes are the result of the meetings with the business environment, considering that this Order’s approval is necessary as to specify the evaluation criteria and to include a new evaluation procedure that takes into account the legal persons that have registered changes regarding the headquarters/associates/administrators.