Gov't approves mechanism to stimulate companies to increase equity

The government has approved, under an emergency ordinance, the establishment of a mechanism to stimulate companies to increase their equity, to move from negative capital to positive capital, Ionel Danca, head of the Chancellery of the Prime Minister, said Thursday.

"The Ministry of Public Finance has proposed a mechanism to stimulate companies to increase their equity in order to move from negative capital to positive capital. After granting bonuses, this year to SMEs and large taxpayers, namely 5 and 10 %, this mechanism practically continues this incentive for companies to improve their financial performance. Thus, if a company in a fiscal year reports an increase in equity of between 5 and 25%, a profit tax rebate of between 5 and 10% will be granted for each step of increasing equity. (...) Companies that already register positive equity qualify for a 2% reduction in corporate tax. This draft emergency ordinance was adopted in its final form at this government meeting and will enter into force as soon as the implementing rules are published," Danca said on Thursday at the end of a government meeting.