Romania has one of the largest tax gaps Europe. In 2019, it saw 34.9% of its VAT revenues disappear. To counter this, Romania is deploying several fiscal measures to drastically reduce the VAT gap. The B2G mandate and upcoming B2B e-invoicing mandate on 1^st July 2022 relating to high-risk fiscal product is viewed as a significant measure to achieve this aim. In addition to the e-invoicing mandate, the operation of the reverse charge mechanism also serves to reduce the VAT gap. This is where the responsibility to pay tax shifts from the supplier to the buyer. To this effect, the domestic reverse charge in Romania has been extended until 2026 on the following products:

• Sale of ferrous and non-ferrous waste
• Sale of wood
• Sale of cereals
• Sale of electrical energy
• Sale of construction, partial construction, land (subject to the VAT regime by option or by law)
• Sale of mobile phones
• Sale of devices with integrated circuits
• Sale of PCs, tablets or laptops

Both the seller and buyer must be Romanian taxpayers for the reverse charge to apply.