Gagauzia Wins VAT Refund Fight
Moldovan businesses in Gagauzia will receive VAT refunds from the national budget, not their local budget, following a recent court victory.
This decision overturns a controversial amendment to the Fiscal Code passed by Parliament in October 2023.
The amendment required Gagauzia, an autonomous region within Moldova, to reimburse businesses for VAT (value-added tax) from its own local budget. This sparked outrage from Gagauzian authorities who argued it would significantly reduce their local revenue.
Several petitions were filed with the Constitutional Court, challenging the amendment's constitutionality. The Court ruled in favour of Gagauzia, declaring the amendment unconstitutional. Until Parliament takes further action, VAT refunds for Gagauzian businesses will be covered by the national budget.
This decision ensures a fairer taxation system across Moldova. The previous amendment raised concerns about unequal treatment for businesses in Gagauzia compared to other regions.
Translation by Iurie Tataru
