ROMANIA: Kaufland risks and reduces VAT to 19% in advance | Progresiv
Kaufland risks and reduces in advance VAT from 20% to 19% on alcoholic beverages, detergents, cleaning products, cosmetics and other non-food products since December 10. Although officially the VAT reduction should enter into force on 1 January 2017, the subject is highly debated: the International Monetary Fund recommended to drop this regulation, and Anca Dragu, the Finance Minister recently stated that the project is not sustainable. However, Kaufland will implement the VAT reduction three weeks earlier than the official date of entry into force. 
"We are happy to support Kaufland customers with lower prices and thus make the Christmas shopping cart less expensive. The new regulation has a direct impact among Romanians and as a sign of support, Kaufland applies it earlier in its stores”, said Valer Hancas, Manager Corporate Affairs and Communication Kaufland Romania.
According to the calculation formula, the VAT rate modification from 20% to 19% for the categories mentioned, is equivalent to a price drop of 0.83%. For example, a product with a price of 5.99 lei (with 20% VAT included) will have a price of 5.94 lei with 19% VAT.
Kaufland Romania owns a chain of 111 hypermarkets. In 2015 the company recorded a turnover of 9.2 billion lei, up by 15% over the previous year.
