Romania's Austerity Measures: Higher Taxes, Lower Investments, and Public Outcry

Romania Faces Austerity Measures Amidst EU Pressure Romania's government is implementing a series of austerity measures under pressure from the European Commission. These measures, aimed at reducing the budget deficit, include significant tax increases and cuts to public spending. The decision has sparked concern among citizens and opposition parties. One of the key measures is a proposed increase in VAT from 19% to 21%. Reduced tax rates for certain goods will also be eliminated, with the exception of food, water, and medicine. Additionally, a tax on every financial transaction made by citizens is being considered. This will affect everything from payments and transfers to withdrawals and other banking operations. "This is a hard hit for Romanian citizens," said one economist interviewed in the video. "The government is cutting investments while increasing taxes, creating a double burden." Furthermore, substantial cuts to public investments are planned, with 10 billion RON (approximately 2 billion EUR) in cuts in the first phase. This will impact various sectors, including infrastructure projects, digitalization initiatives, and European Union-funded programs. Benefits will also be eliminated. The video highlights the tense negotiations between the ruling parties (PSD, PNL, UDMR, and USR) regarding the formation of a new government. The situation is so critical that no party wants to take responsibility for the unpopular measures. Without a stable government and budget, Romania risks defaulting on payments for pensions and salaries within months. The head of state has attempted to calm public anxieties, but the outcome remains uncertain. The video concludes with a visual representation of the financial uncertainty facing Romania, emphasizing the gravity of the situation.