Data released by the National Institute of Statistics on 8 October 2026 shows that average monthly household income reached 10,204 lei in Q2 2026, a 7.4% year-on-year increase. However, the share of taxes and social contributions in total household expenditure climbed to 36.5%, up from 34.8% a year earlier. The rise reflects both higher nominal wages pushing earners into upper tax brackets and the full-year effect of the 2025 social contribution hikes. The report also notes that indirect taxes (VAT, excises) account for nearly 60% of the total tax burden, disproportionately affecting lower-income households. Policymakers face pressure to adjust the personal income tax (PIT) brackets, which have not been indexed since 2018.
Key Takeaways
- Bracket Creep Effect: Static PIT thresholds combined with wage growth have increased the effective average tax rate for middle-income earners by an estimated 1.2 percentage points.
- Indirect Tax Dominance: VAT and excises constitute the largest slice of household tax payments, reinforcing calls for targeted relief on essential goods.
- Policy Response Expected: The Ministry of Finance has indicated that PIT bracket indexation and a potential increase in the non-taxable allowance are under review for the 2027 budget.
Disclaimer: This article is compiled and summarized by the AI based on publicly available information and is for general information purposes only. It does not constitute any form of formal tax advice, legal opinion, or basis for performance. Please consult a qualified professional tax advisor or legal counsel for tax advice.
Source: Read Official Announcement