In Romania, VAT is an indirect tax applied to goods and services, paid by the final consumer and administered by businesses registered for VAT.
VAT (Value Added Tax) represents a consumption tax added to most goods and services in a country, collected periodically by businesses and ultimately paid by end consumers.
VAT plays a key role in government revenue and affects businesses, consumers, and cross-border transactions.
The standard VAT rate in Romania in 2026 is 21%, applied to most goods and services, following an increase from 19% on August 1, 2025. The country has a reduced VAT rate for specific items, and services in certain areas are exempt from VAT.
This guide explains in simple terms what VAT is, how it works in Romania, how VAT is calculated, who must register, and how VAT applies across key sectors.
You’ll also learn key details about the EU community VAT, common VAT mistakes, and other related details.
What is VAT?
VAT is a consumption tax added to most goods and services and collected by businesses at every stage of the supply chain, from raw materials to final sales, but ultimately paid by end consumers, as an indirect tax on final consumption.
Key VAT-related aspects
VAT key aspects include the following:
- Indirect tax – Consumers pay VAT as part of the product/service price, but businesses collect it and remit it to the government.
- Applied at each chain stage – From the production stage to retail, tax is levied on the added value (including labor, profit, and materials).
- Credit system – Businesses receive refunds for VAT paid on inputs, which prevents a cascade of taxes.
- Final payer – The consumers are the final VAT payers, receiving no credit for paid taxes.
- County variation – VAT rates differ globally.
- VAT number – Businesses included in the VAT system must register and get a VAT ID.
Who does VAT matter for?
VAT matters for all entities in a country’s economy, but in different ways:
| Stakeholder | Role / Description | Why VAT Matters |
|---|---|---|
| Government (the biggest stakeholder) | Collects and reports VAT, prevents fraud, and sets rates/exemptions to balance revenue vs. social policy | Usually one of the largest sources of public revenue; Relatively stable and predictable; Harder to evade compared to income tax |
| Businesses | Act as VAT collectors; pay VAT before getting refunds | Businesses charge VAT, collect it, report it, and pay it; They can deduct input VAT if certain rules are followed; Mistakes can lead to penalties, audits, or blocked refunds |
| Consumers | Final VAT payers | Increases the price of goods and services, leading to higher costs of living; Consumers cannot deduct VAT |
| Small businesses & freelancers | May fall below or above VAT registration thresholds | If they’re below the VAT threshold, no VAT is charged; VAT status affects pricing competitiveness |
| Tax authorities & auditors | Monitor compliance and enforce VAT rules | VAT is fraud-prone and requires audits, inspections, and enforcement systems; Cross-border VAT is more sensitive |
| Foreign businesses & investors | Operate or sell into the country from abroad | Affects market entry; Influences pricing strategy |
| Society (overall) | Indirectly affected through prices and policy | VAT is regressive, hitting low-income people harder; Reduced taxes are applied to essentials like food, medicine, and energy; VAT is a policy tool, not just a simple tax |
VAT in Romania
In Romania, in 2026, the standard VAT rate is 21%, up from 19% since August 1, 2025.
Other key details about Romania’s VAT system include the following:
- There is a reduced rate of 11% for specific goods and services, detailed by ANAF.
- Certain goods and services related to healthcare, education, financial services, culture, and other regulated activities are exempt from VAT.
VAT in Romania is an indirect tax applied to the supply of goods and services, and to imports, representing a key state revenue source. Businesses act as tax collectors, and consumers are the ultimate taxpayers.
In Romania, VAT is regulated by the Fiscal Code and aligned with EU VAT directives. The system is administered by ANAF, which oversees registration, reporting, collection, and compliance via audits and anti-fraud measures.
How to calculate VAT?
To calculate the VAT amount, you have to multiply the net price of a product/service by the VAT rate (decimal).
In Romania, for goods and services subject to the standard VAT rate, the formula is: VAT amount = Net price × 0.21.
How to calculate final prices with VAT included
The final price of a product or service is the initial price (without VAT) plus 21% of the product’s initial price (if the product or service undergoes the 21 percent VAT tax).
Multiple websites provide the calculation of a product or service price with VAT included.
For instance, to calculate the price of a final product/service that initially costs 20 RON (without VAT), we add that price to 21% (meaning 4.2 RON). This means that the final price of the product is 24.2 RON.
Conversely, to determine the initial (net) price from a final price that includes VAT, you must divide the final price by 1.21.
You can simply use a VAT calculator to find out a product/service’s gross/net price. Some calculators also provide conversion from the local Romanian currency RON to EUR or other currencies or vice versa, based on the current BNR prices.
VAT registration and VAT payers
Businesses and self-employed individuals that exceed a specific revenue threshold over a defined period (usually one year) must register for VAT.
Important nuances worth mentioning for the EU states include the following:
- The VAT threshold is not the same in all EU states.
- Certain activities trigger VAT regardless of their turnover (like EU transactions, certain digital services, or cross-border sales).
- Entities can opt into VAT voluntarily for a more “established” status.
In Romania, businesses and self-employed individuals must register for VAT when taxable turnover exceeds 395,000 RON within a 12-month period, according to amendments to the Romanian Fiscal Code effective from September 1, 2025.
VAT registration in Romania is handled by ANAF, the National Agency for Fiscal Administration.
Mandatory vs optional registration
The difference between mandatory and optional registration is the following:
- Mandatory VAT registration applies when a business or self-employed individual’s annual taxable turnover exceeds 395,000 RON. In such cases, the entity must apply for VAT registration, and VAT becomes applicable starting with the transaction that causes the threshold to be exceeded.
- Optional registration is available for businesses or self-employed individuals below the 395,000 threshold if the entity chooses to register voluntarily for VAT.
VAT registration threshold
In 2026, the annual taxable turnover limit for VAT registration in Romania is 395,000 RON. An entity becomes VAT-registered after submitting a VAT registration application to ANAF and receiving approval.
VAT registration with ANAF involves the following:
- ANAF assigns the VAT registration number to the entity.
- The authority administers VAT filings and payments.
- It also handles audits, compliance checks, and VAT refunds.
VAT code
In Romania, the VAT code is made of the country code (RO) and the business’ fiscal ID. This is used on invoices and for VAT reporting.
In Romania, the VAT code is made of the country code (RO) and the business’ fiscal ID.
A company can have a fiscal identification number (CUI) without being VAT-registered. After the entity becomes VAT-registered, the same CUI is used as a VAT ID, with RO as a prefix.
To verify a VAT identification number/code of a VAT-registered entity in Romania, you have to:
- Head over to the ANAF official website
- Introduce the fiscal code of the entity
- Validate the check code and search for the specific entity
VAT payer registry
The VAT payer registry is ANAF’s VAT-registered list of entities that are VAT payers in the country. This registry matters for the legitimacy of these entities and to see if they are VAT payers in Romania.
Cash accounting VAT (VAT on collection)
Cash accounting VAT (VAT on a cash basis) is a special VAT scheme under which VAT becomes payable when payment is actually received, rather than when the invoice is issued.
- The business/self-employed individual charges VAT on the invoice.
- It pays VAT to the tax authority only after the customer pays the invoice.
- The entity deducts input VAT only after the payment.
Under the standard VAT system, VAT generally becomes chargeable at the time of invoice issuance or supply, regardless of whether payment is received.
The cash accounting VAT system is best for:
- Small and medium-sized businesses
- Companies with longer payment terms
- Businesses that want better cash-flow management
- Entities that want to avoid the risk of paying VAT that they never collect.
In Romania, the cash accounting VAT scheme is optional and available below specific turnover thresholds and under conditions set by the Fiscal Code and administered by ANAF.
In Romania, businesses and self-employed individuals with a taxable turnover below 4.5 million RON in the previous calendar year may opt for the cash accounting VAT scheme, subject to the conditions provided by the Fiscal Code.
VAT for real estate in Romania
In Romania, the standard VAT rate of 21% generally applies to new homes and apartments sold by VAT-registered sellers, with reduced VAT rates available in specific cases defined by law.
Real estate VAT rules in Romania have changed starting August 1, 2025, following amendments to the VAT framework.
VAT is applied to real estate transactions in the country depending on:
- Property type
- Property use
- Who is involved in the transaction
According to Law 141/2025 published in Monitorul Oficial, VAT rates and conditions for residential real estate have changed, especially for newly built homes. Key points worth noting include the following:
- VAT generally applies to new residential properties and to properties sold by VAT-registered sellers acting in a taxable capacity.
- Most private individuals selling older residential properties remain VAT-exempt, provided the transaction does not qualify as an economic activity subject to VAT.
VAT on homes
VAT applied to Romanian housing involves a distinction between new homes and old homes, with standard VAT and reduced VAT applied based on this distinction.
Following the new legislation:
- Standard VAT of 21% applies to most new homes and apartments, including new residential developments sold by developers.
- Reduced VAT of 9% is only available in limited transitional cases, in which a purchase agreement and advance payment were made before the legal deadline set by law.
- Homes that don’t qualify for VAT (like older homes sold by private individuals) remain VAT-free.
Before the new law, certain homes benefited from a 9% VAT if they met specific conditions related to size, price, and buyer type.
Who pays VAT when selling property
VAT responsibility in Romania depends on:
- Who the seller is – If the seller is a VAT-registered entity, VAT is included in the sale price and paid by the buyer; if the seller is a private individual selling an old home, VAT does not apply
- Whether the transaction is subject to VAT
VAT for specific sectors in Romania
Certain sectors in Romania are subject to specific VAT treatments, including reduced rates and exemptions. The main sectors analyzed below include food and HoReCa services.
VAT on food
VAT applied to food products in Romania varies depending on product classification:
- The standard VAT rate of 21% applies to products such as sugary beverages, certain non-alcoholic drinks, coffee, dietary supplements, and other goods that do not qualify as essential food.
- A reduced VAT rate of 11% applies to essential food products, animal feed, and other qualifying goods explicitly listed in the Fiscal Code.
VAT in HoReCa
VAT for HoReCa services, including hotels, restaurants, and catering activities, is subject to a reduced VAT rate of 11% in Romania in 2026, in accordance with sector-specific VAT provisions.
VAT changes and increases in Romania
In Romania, the standard VAT rate was increased from 19% to 21% starting August 1, 2025, following the adoption of fiscal legislation by the Romanian authorities.
The increase was part of a major fiscal reform implemented via Law no. 141/2025, which also simplified the VAT system by replacing reduced taxes of 5% and 9% with a single 11% reduced rate for essential goods and services.
The main purposes of the increase were to:
- Boost government revenue
- Help reduce Romania’s budget deficit in line with EU requirements
Intra-community VAT
Intra-community VAT refers to the VAT rules that apply to transactions between entities located in different states.
The European Union harmonizes these rules across the region to ensure that:
- VAT is collected correctly
- Double taxation is avoided
Intra-community VAT applies mainly to goods/services exchanged between VAT-registered entities in different countries in the EU.
VAT rules for EU transactions
For EU cross-border transactions, VAT treatment depends on various factors, including the following:
- Transaction type (whether it involves goods or services)
- Parties making the transaction (whether they are VAT-registered)
- The country of the supply
Key points about intra-community transactions are the following:
- Intra-community supplies between VAT-registered entities are zero-rated in the seller’s country.
- The buyers account for VAT in their own country, in accordance with the VAT-related rules.
- Both parties have to be VAT-registered and have valid VAT codes.
Reverse charge mechanism
The reverse charge mechanism is a VAT system in which the obligation to account for VAT shifts from the seller to the buyer to:
- Simplify compliance
- Prevent VAT-related fraud
Under this mechanism:
- The seller issues an invoice without charging VAT.
- The buyer reports both output and input VAT in their VAT return.
- No actual VAT payment is made at the time of the transaction.
Private individuals and non-VAT-registered entities cannot use this reverse charge mechanism.
VAT in 2026 in Romania vs other EU countries
EU member states apply different VAT systems, based on national fiscal policy and economic conditions. While in Romania, the standard VAT rate is 21%, other states apply the following rates:
Spain
In Spain, the standard VAT is 21% for most goods and services, including tourist rentals. Reduced rates of 10% are applied for some foods, housing, and transport, and a super-reduced rate of 4% is applied for essentials, including basic food, books, and medicine.
France
France applies a standard VAT rate of 20% to most goods and services. A reduced rate of 10% applies to restaurant services, hotel accommodation, passenger transport, and renovation work.
A reduced VAT rate of 5.5% applies to essential goods such as most food products, books, and cultural services.
A super-reduced rate of 2.1% applies to a limited number of goods, including certain pharmaceutical products and press publications.
Germany
Germany applies a standard VAT rate of 19% to most goods and services. A reduced VAT rate of 7% applies to certain essential goods, including food products, books, and cultural items.
A 0% VAT rate applies to exports and certain cross-border or intra-EU transport services.
Italy
Italy applies a standard VAT rate of 22%. A reduced rate of 10% applies to tourism services, passenger transport, construction and renovation services, and certain food and energy products.
A reduced VAT rate of 5% applies to specific social or public-interest services.
A super-reduced VAT rate of 4% applies to essential goods, including basic food items, books, newspapers, and some medical supplies.
Hungary
Hungary applies a standard VAT of 27%, higher than Romania, and one of the highest in the EU.
The country applies a VAT of 18% to certain food products, and a rate of 5% is applied to various goods and services, including some foods, books, newspapers, some hotel accommodations, local dining services, and cultural services. The same rate is applied to new residential property under specific conditions, and some medical products.
Hungary may apply a 0% rate in limited cases, including some intra-EU and international transport.
Bulgaria
Bulgaria applies a standard VAT rate of 20% to most goods and services. A reduced rate of 9% is applied to specific categories, including baby foods, hygiene products, books, periodicals, hotel accommodation services, and some cultural/social services.
Common VAT mistakes
Some of the most common VAT-related mistakes an entity can make include the following:
| Common VAT Mistake | Description / Example |
|---|---|
| Not registering (or registering late) for VAT | Starting your business without registering or exceeding the VAT threshold, and registering late. Consequence: retrospective VAT liability and fines. |
| Incorrect calculation of VAT | Applying wrong rates, miscalculating VAT-inclusive/exclusive prices, or rounding errors. |
| Misusing VAT reductions or exemptions | Claiming reduced rates or exemptions incorrectly, e.g., applying a reduced rate to ineligible goods/services. |
| Failing to issue proper VAT invoices | Missing required info such as VAT number, correct rate, total amount, or proper description of goods/services. |
| Incorrect reporting on VAT returns | Omitting transactions, reporting in the wrong period, or mixing domestic vs intra-EU sales. |
| Recovering VAT incorrectly on purchases | Claiming input VAT on non-deductible expenses (e.g., personal items, entertainment, some vehicles). |
| Failing to maintain proper VAT records | Not keeping invoices, receipts, or proof of intra-community supplies, risking disallowed deductions during audits. |
| Charging VAT on exempt items/services | Applying VAT to items normally exempt, like certain financial services, healthcare, or education. |
| Late payment of VAT | Paying VAT after the deadline, incurring penalties, and interest. |
| Incorrect use of VAT codes | Using wrong VAT codes for transactions, especially in cross-border or intra-community situations. |
FAQ about VAT in Romania
What is VAT?
VAT (Value-Added-Tax) is a consumption tax that each country applies to most goods and services and is ultimately paid by the end consumer.
How much is VAT in Romania?
The standard VAT in Romania is 21%, with a reduction of 11% on certain goods/services; there are also some exemptions for certain goods or services in the country.
How is VAT calculated?
VAT is calculated as a percentage of the price of a good/service. This percentage is added by the entity to its selling price, collected from the end customer, and then paid to the government.
When do you become a VAT payer?
You can become a VAT payer by becoming VAT-registered in your country. For instance, in Romania, you can become VAT-registered with ANAF.
What is the VAT registration threshold?
The VAT registration threshold is a financial limit above which you are mandated to pay VAT. In Romania, the current VAT registration threshold is 395,000 RON.
Who pays VAT when selling an apartment?
When a VAT-registered entity sells an apartment, the buyer pays VAT, and the seller pays it to the government.
What is VAT on collection?
VAT on collection (or VAT on a cash basis) is a special VAT scheme where VAT becomes payable only when the payment is actually received by the entity, not when the invoice is issued.
How can I check a VAT code?
You can check a VAT code or identification number for a VAT-registered entity on the official website of ANAF.
