Accounting relief for Romanian banks
The Romanian government provided some welcome tax accounting news for the banking sector at the end of 2011.
Though new fiscal rules for banks that use IFRS wereannounced on December 27 as part of wider changes to the tax system, they include a tax break for net amounts registered in early 2012 resulting from the establishment and release of provisions after the enforcement of IFRS, as long as these sums are kept in a bank’s reserve account, as well as the deductibility of IFRS provisions and additional provisions resulted from the enforcement of regulations by the National Bank of Romania (BNR), the central bank.
Gheorghe Ialomitianu, the Public Finance Minister, also announced that the government and the BNR had agreed that no tax liability would arise from the differences resulting from the application of the local accounting rules and IFRS for various income and expense items specific to the banking system.
“The central bank said that for reasons of prudence, it would be good to keep this difference in revenues in the accounting records...and as long as they represent funding sources for the banks, they should not be taxed,” Ialomitianu told the Actmedia news agency.