The Federation of Employers' Associations in Romania's Hospitality Industry rejects another increase in the minimum wage without a reduction in labor taxes

The Federation of Employers in Romania’s Hospitality Industry (FPIOR) announces that it does not support another increase in the minimum wage under the current fiscal conditions and calls on the Government to reduce taxation on low incomes. Employers maintain that employees should earn more, but an increase in gross wages without tax reform could primarily increase companies’ costs and state revenues.

FPIOR calls for any decision on the minimum wage to be accompanied by measures that increase the net amount retained by employees and protect purchasing power. The organization also proposes eliminating taxation on the minimum wage, while identifying solutions to offset the impact on the budget.

FPIOR Executive President Călin Cozma says that, for a 200-leu increase, the state would collect nearly 300 lei through taxes and duties. Meanwhile, the federation’s president, Valentin Șoneriu, argues that Romania has one of the highest levels of taxation on low incomes in the European Union.

According to calculations presented by employers, a 300-leu increase in the minimum wage would reduce a company’s annual gross profit to 24,699 lei, while a 500-leu increase would bring it down to 23,538 lei. Nearly 700,000 companies could be affected, FPIOR estimates, calling for consultations between the Government and social partners before a decision is made.