An article within the Fiscal Code allows the imposition of a 21% VAT rate for services starting in July, provided that these services are delivered continuously, such as those offered on a subscription model. This explanation has been put forth by energy firms for the July invoices that were sent out in August with the elevated tax. Now, former MEP Vlad Gheorghe is accusing the Ministry of Finance of neglecting to revise this article and is calling on the agency to „rectify this misinformation.”
In a response to HotNews, Alexandru Nazare commented, „I will verify the claims made by Mr. Vlad Gheorghe.”
These allegations arose as electricity bills began to reflect a 21% VAT, even though the consumption period in question was July, during which the VAT rate stood at 19%.
As of August 1, 2025, the VAT increased from 19% to 21% generally, as part of measures to address the budget deficit.
Increased VAT applied to July energy consumption bills
The standard principle for VAT application is that the rate active at the time of service delivery is the one that applies. Nonetheless, according to the Fiscal Code, there are exceptions that pertain to continuously provided services, like subscription services. Specifically, for these scenarios, a 21% VAT is charged if the bill is issued in August for services rendered in July.
Concerning this matter, Hidroelectrica released a statement indicating, „Invoices issued from August 2025 onward will include the regular 21% VAT, adhering to specific tax regulations for continuous supply, including electricity provision.”
„Should services be continuously provided, such as with natural gas, water, electricity, telecommunication, leasing, rental of goods, they will be charged at the VAT rate effective on the payment date stipulated by contract or, in the absence of such a provision, at the date of the invoice issuance, thus 21% if payment occurs after August 1,” tax consultant Cornel Grama detailed on his Facebook page.
Provision within the Fiscal Code that permits the 21% VAT rate for July services
This is a statute located in the Fiscal Code, article 281, paragraph 8:
„In the case of continuous provision of goods and services (…) such as natural gas, water, electricity, telecommunication services, leasing, concession, rental of goods, granting payment rights for a specified duration of real rights, like usufruct and superficies, over immovable property, and other similar provisions/services, it is deemed that the delivery of goods/provision of services occurs on each date set forth in the contract for remuneration of delivered goods/provided services, or in the absence of such contractual stipulations, upon the issuance date of the invoice, but the settlement period should not exceed one year.”
Vlad Gheorghe has urged for an amendment to this article, as stated in a Facebook post. „I refuse to accept that we endure even higher taxes than those already communicated simply because someone in the ministry ‘overlooked’ modifying a legal text. Urgently amend the law,” asserted Vlad Gheorghe.
