The Impact of the VAT Decrease for Food and Non-Alcoholic Drinks in Romania

On June 1 2015, the VAT was decreased in Romania from 24% to 9% for all food products, non-alcoholic drinks, foodservice and draught beer. After the VAT was decreased, domestic consumption consolidated, and lower retail prices left more money in consumer’s pockets that was spent on higher quantities of food and other products. Overall retailing also benefited, as Hungarians started to see Romania as a destination for food shopping. Although the positive impact of the VAT decrease is easy to see in grocery retailers, non-grocery retailers have not yet benefited from it.

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