The decision of the interim Finance Minister, at the end of his term, Tanczos Barna, not to attend the meeting of the EU finance ministers, ECOFIN, on Friday to present and negotiate a concrete, calculated, and feasible plan to reduce Romania’s budget deficit is absolutely justified, so that the procedure of blocking European funds can be stopped.
And it’s not about pettiness or revenge, but about being ridiculous.
Let's imagine a dialogue. Mr. Tanczos presents the measures, commitments, and in the end, he is asked: how long will you still be in office? About 2-3 days! And do you have the mandate from whom? From an interim government that will last another 2-3 days. And why should we trust the commitment of an interim minister who has only 2-3 days left? Because we have nothing else. Why, weren't the elections last month? Let a full minister come, from a titular government, and then we can talk.
The trip of the minister to ECOFIN would have been not only useless but downright ridiculous, not only for him but also for Romania. The trip of a state secretary is no less ridiculous for Romania. Considering the stakes, it would be a decent option for the designated prime minister to go there if we have one on Friday.
This was the rush we were talking about while wasting time in useless committees and commissions that did not result in any understanding or grand plan. The rush was to have a titular government until you have to negotiate a huge stake.
Tanczos Barna has achieved a good performance in Finance, considering what he inherited, the electoral campaign, and the fact that Marcel Ciolacu was the Prime Minister. No one has reproached him with anything concrete, and it was essential for there to be continuity so that Brussels knows who they are talking to, even in this transition period.
And if the successor will be the eternal Marcel Bolos, one of the architects of the current disaster, we can only console ourselves with the fact that the funeral of the budget will be professional, as a well-known joker said. And the funeral of appointments based on competence.
What follows is still unclear, even though Friday is tomorrow. The information was that taxes on dividends and profits, and VAT, would increase, from 19 to 21%. But Nicusor Dan has stated in writing that VAT will not increase during your entire term. That's why the fiscal plan is not ready; there should be a discussion on Thursday evening with only Ilie Bolojan.
The likely future prime minister has not hidden that he does not see a way out without increasing taxation. Why?
Of course, normally, you first reduce expenses and only then, if it's not enough, you increase taxation. Of course, you first collect taxes well in force, and only then, if needed, you increase them. But Romania has promised too often to cut expenses and improve tax collection for this plan to be credible.
Even now, this reduction is not accompanied in the discourse of any party by concrete data or calculations. How much and from where do you cut to achieve the required 30 billion?
And in the conditions where Romania has one of the lowest VAT rates in the EU, of course, Brussels is pressuring there.
It seems that the solidarity tax has disappeared from the measures plan. Which is not a surprise. It wasn't even applicable from July 1 because the tax administration couldn't switch to income globalization in 10 days. But it was launched by the populist PSD as a negotiating lever.
As long as the VAT would be increased by the liberal prime minister and the finance minister, also liberal (in the best case Hungarian, if they come to their senses), and they vehemently opposed it, it's good for the Social Democrats. In fact, they are the only ones with a well-structured political survival plan.
And the biggest problem of these negotiations and the resulting plan is that they give the feeling of both improvisation and opacity. We don't even know what we should do, but we definitely won't tell you what we're thinking.
Three weeks later, we hope that by doing the same thing, the outcome will ultimately be different.