From 2020, the preliminary income tax withholding will increase from 7% to 12%.

From 2020, the preliminary income tax withholding will increase from 7% to 12%.

This is envisaged by amendments to the Tax Code, approved by the government at a meeting on Friday. In accordance with the amendments, in Moldova will remain the unified income tax rate for individuals and legal entities, introduced on October 1, 2018. At the same time, it was proposed to increase from 7% to 12% the amount of preliminary withholding of payments made in favor of a resident, according to Article 90 of the Tax Code. Thus, since 2020, each person engaged in entrepreneurial activity, with the exception of holders of entrepreneurial patents and persons carrying out independent activities, each representative office, permanent establishment, institution, organization, including any public authority and public institution, will be preliminarily held as part tax amount of 12% of payments made in favor of an individual, with the exception of owners of entrepreneurial patents, individual entrepreneurs as well as peasant (farmer) and other persons specified in the law. Thus, the amount of 12% of payments made in favor of an individual is not previously withheld on income received by him in accordance with Articles 20, 88, 89, 901 and 91 from the alienation of vehicles, the alienation of securities, as well as from the amount of rent of agricultural land and / or alienation of capital assets of individuals-citizens of Moldova according to leasing agreements, leasebacks, collateral, mortgages and / or in cases of forced alienation of capital assets, and in case of liquidation of an economic entity - from liquidation plots non-monetary forms. As noted in the Ministry of Finance, this measure is aimed at simplifying tax administration and ensuring tax compliance of individuals who are not engaged in entrepreneurial activity. This measure will bring additional revenues to the state budget in 2020 approximately in the amount of 24 million lei. // 09.08.2019 — InfoMarket.

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