The Challenges to Long Run Fiscal Sustainability in Romania

Canagarajah, Sudharshan ; Brownbridge, Martin ; Paliu, Anca ; Dumitru, Ionut

关键词: ACCOUNTING;    ACCUMULATION OF ARREARS;    ADVERSE CONSEQUENCES;    ANNUAL REPORT;    ARREARS;   

DOI  :  10.1596/1813-9450-5927
RP-ID  :  WPS5927

学科分类：社会科学、人文和艺术（综合）

来源: World Bank Open Knowledge Repository

【 摘 要 】

Romania, along with many other countriesin the European Union, faces daunting fiscal challenges.Fiscal balances deteriorated sharply following the globaleconomic crisis, forcing Romania to implement a fiscalconsolidation that was one of the largest in the EuropeanUnion, but which may not be sustainable without a recoveryof economic growth. Although the ratio of public debt togross domestic product is still relatively modest, at around35 percent, long-term fiscal solvency is threatened by thecosts of funding the public pension system in the face ofadverse demographic shifts over the next 50 years. Becauseof widespread tax evasion, the tax system in Romania is oneof the least efficient in the European Union. Tax reformsthat can reduce the amount of tax lost to evasion and fraudcould make a major contribution to enhancing fiscal sustainability.