Parliament Approves Fiscal Amendments: lottery income to Sports, Culture, SMEs, and Rural Tourism

Parliament approved a comprehensive fiscal reform package aimed at strengthening Moldova’s economy and supporting key sectors. The amendments, passed in the second reading by 57 deputies, redirect revenues from lottery activities to vital areas of development and introduce changes to 12 laws, including the Tax and Customs Codes.

Redirected Lottery Revenues

The government will now allocate 60% of lottery income to sports, and 20% each to culture and local cinema. In 2024, lottery revenues reached 200 million lei, according to IPN.

Key Fiscal Measures and Benefits

✅ Support for Local Producers

Public institutions can now award additional points to businesses located closer to the delivery point in public procurement evaluations. This measure supports local producers and cuts transportation costs.

✅ Expanded SME Definition

The threshold for classifying small and medium-sized enterprises (SMEs) will increase from 100 million to 500 million lei in annual turnover. This update ensures more businesses remain eligible for national and international support programs.

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✅ Employee Incentives

A new Fiscal Code article allows employers to deduct up to 50% of the average monthly salary for employee-related expenses, including:

• Rural tourism visits
• Vacation vouchers
• Gym memberships or sports subscriptions
• Alternative childcare (up to 2,500 lei for children under three)

📌 Note: Only one type of expense per employee qualifies for deduction above the set ceiling.

✅ Expanded Non-Taxable Income

The state will treat transport and housing allowances as non-taxable income for public officials, dignitaries, and medical/pharmaceutical workers serving outside their place of residence.

Reforms for the Business Sector

• Simplified Taxation: The amendments clarify tax rules, reduce legal uncertainty, and promote voluntary compliance.
• Support for Rural and Strategic Sectors: SMEs in rural areas, and industries such as IT, agriculture, and tourism will benefit from reduced tax reporting and lower administrative costs.
• Transfer Pricing Rules for Large Enterprises: Companies with transactions over 20 million lei involving affiliated entities must now follow updated transfer pricing regulations. It targets high-risk fiscal behavior while easing the burden on low-risk companies.

Strategic Goals

The fiscal package aims to:

• Promote economic resilience
• Modernize Moldova’s tax framework.
• Align fiscal policies with development priorities.

By shifting resources and offering targeted incentives, the reforms support local growth, entrepreneurship, and national modernization efforts.