Tax evasion in Romania - a national security issue

• Author: Constantin Adrian Manea
• Position: Law Department, Transilvania University of Brasov
• Pages: 163-172

Bulletin of the Transilvania University of Braşov

Series VII: Social Sciences • Law • Vol. 8 (57) No. 1 - 2015

TAX EVASION IN ROMANIA –

A NATIONAL SECURITY ISSUE

Constantin Adrian MANEA1

Abstract: Given the fact that the level of tax evasion in Romania has

consistently been above average in the European Union, factors such as the

fluctuating tax law, the IRS poor results in recovering overdue taxes, the

increase in the corruption of the dignitaries and state officials involved in tax

evasion cases have contributed in recent years to a worrying increase in the

tax evasion in Romania. The devastating economic consequences of tax

evasion on the national budget currently qualify tax evasion as a frontal

attack on the economic safety and national security, as confirmed by

statistical data and which must be countered by drastic fiscal measures and

national operative strategies.

Key words: tax evasion, underground economy, tax burden, tax, black

labour.

1 Law Department, Transilvania University of Braşov.

1. Introduction

Being a European Union Member State,

Romania is facing serious problems in

recent years regarding tax evasion and tax

fraud, whose level remains constant over

the average level in the European Union.

The two fiscal phenomena have

proliferated increasingly amid the

economic crisis in 2009 in the Romanian

society, underpinned by the growth of

corruption and bureaucratization of the

public system and public administration,

under a restriction of public transparency

facilitated by an unstable legislation,

subject to frequent changes of substance

and institutional ones.

Having at disposal a tax legislation with

loopholes and lax in terms of

interpretation, the fiscal control bodies

seem to abandon the fight with fraudsters,

as if resigning before the complex

operations and mechanisms of the "white-

collar" offenders.

The fact that tax evasion and widespread

corruption, especially at the level of public

administration, are negative phenomena

which negatively affect the level of

taxation and the economic growth, leading

to the increase in Romania's public debt, it

is recognized in the economic literature [1]

and in the trials, reports and analyzes of

the Fiscal Council [14] or UNDP [15] -

The United Nations Development

Programme in Romania.

Against the adverse economic

consequences and combating these

phenomena nationwide, reform measures

and strategies have been and are proposed,

starting and taking into account the

findings of the institutional, governmental

and nongovernmental evaluations, made in

Romania, but also from external sources

(monitoring reports of the European