Romania's Weak Fiscal State: What Explains It and What Can (Still) Be Done About It

This study aims to establish the causes for Romania's fiscal weakness and propose legislative and administrative reforms that could remedy the situation.
The results lay the blame on the poor institutional capacity of the Romanian revenue agency (ANAF) and the undertaxing of firms and the wealthy via legislative reforms that have cut tax levels and administrative practices that tolerated tax avoidance for these categories of tax payers relative to consumers and employees.
If the Romanian government could follow into the footsteps of Bulgaria and other new EU member states, it would avoid the nearpermanent fragility of its finances and be better situated to close the educational, health, social and infrastructural gaps that separate Romania from its regional peers society despite robust economic growth.