Bill to stimulate investment in the capital market: simplifying bureaucracy and reducing taxation for individual stock market investors

PNL deputies Sebastian Burduja, Gabriela Horga, George Tuta and USR senator Claudiu Muresan submitted a bill that increases the attractiveness of the capital market, as an alternative to placing money, by simplifying bureaucracy and reducing taxation for individual investors on the stock exchange. The draft law proposes to reduce the transaction tax from 10% to 1%, for securities held for more than one year, respectively 3% for securities held for less than one year, to implement a withholding tax system and to eliminate the obligation to declaration of losses, as it currently stands. The legislative initiative enjoys a wide support: over 50 deputies and senators PNL, USR, UDMR and PSD signed the legislative project.

The aim is to simplify the tax regime for investors, which will increase the number of individuals investing in the Romanian capital market, both directly and through investment funds. At the same time, the aim is to increase the efficiency and the degree of collection of capital gains taxes from the state budget.

The signatories of the bill explain, in the explanatory memorandum, that this approach has worked in countries with more developed stock exchanges. In Europe, Belgium and Switzerland do not tax net capital gains; there are other types of taxes on the value of transactions or on the total portfolio for asset values ​​above a certain level. Globally, in jurisdictions such as Singapore or Hong Kong, the capital market has grown dramatically, directly related to the absence of capital gains taxes.

“There is no developed economy without a strong capital market. The Romanian stock market has made major progress in recent years, and this is the merit of the market. As an economist, but also as a politician, I made a commitment, together with my colleagues, to support this effort by stimulating investor participation in the Romanian stock market, in order to respond with an adequate demand to a growing and diverse offer from the part of the companies listed or to be listed.

Thus, through the combined efforts carried out at legislative and executive level, the performing companies in Romania will be able to be financed more easily through the stock market, with all the related benefits, and the measures proposed by us will stimulate the growth of the active investors base on the capital market. Within 3-5 years, the tax base will increase exponentially, and the financial impact on the state budget will be definitely positive, both from the perspective of long-term development of Romanian companies, which means jobs, and higher yields in the money invested by Romanians.

I thank the capital market players for their efforts in this joint project, for their initiative and perseverance. I will always support projects that support the economy, the local entrepreneurial environment and the financial education of Romanians. It is also a law of the capital market for the development of the economy. It is a law that will lead us to an authentic capitalist stage, with a strong and developed stock market, in a society where Romanians talk about their investments in the stock market for coffee with friends and dinner with family, as happens in the USA. and in other advanced economies,” said Sebastian Burduja, a member of the National Liberal Party, one of the initiators of the bill.