Dividend taxes paid by non-residents could drop to 10% as of 1 July

 “Dividend taxes paid by non-residents will be equal to those paid by residents, as of 1 July, or by the latest on 1 January 2009. According to the letter of formal notice sent by the EC at the beginning of May, the change should go into effect by 1 July 2008 and will be adopted by an Emergency Ordinance,” said the Minister. The letter by the European Commission (EC) regards the taxation of dividends paid to companies resident elsewhere in the EU or in the European Economic Area/European Free Trade Association (EEA/EFTA) countries. Domestic dividends on participations of up to 15 percent of the shares are presently subject to a final withholding tax of 10 percent, according to the letter, which goes on to say that “on similar outbound dividends, Romania levies a withholding tax of 16 percent.”