Expert Forum’s Nuțu said austerity measures would be “terribly unpopular” if the government doesn’t reduce unnecessary public expenditures such as high pensions for former civil servants. “People will be very angry and we will continue to see, in the next elections, that they will blow everyone away,” she said, predicting a potential further rise in hard-right populism.
Nuțu and Dăianu pointed to efforts to collect more VAT as one area that could bring significant gains in reducing the deficit.
The gap between total potential VAT revenues and what the Romanian tax authorities collected in 2022 was €8.5 billion — or more than 30 percent of the total that could be collected, according to the latest Commission data.
“There will be a forceful intervention in this area,” said Victor Negrescu, a Social Democrat member of the European Parliament.
Romania’s tax authority needs to digitize to target evasion, he said, adding many people run unregistered economic activities and don’t pay the taxes due.
President Nicușor Dan plans to discuss tax evasion as a threat to national security with Romania’s top national security officials at a meeting on Monday.
The Fiscal Council’s Dăianu said the new government still had to produce an impact assessment of most of the measures it is considering. But in a positive scenario, these could pull Romania’s budget deficit under 8 percent of GDP by the year’s end, he predicted.
“The numbers are still approximate, but I believe Romania will avoid a downgrade,” Dăianu said.