The local or foreign companies that operate in Romania receive little support or incentives from the state to develop and carry out CSR activities. According to the report “Review of Tax Incentives in the Context of CSR in Selected European Countries”, prepared by the consulting firm Accreo Taxand, Poland, in mid-2011, shows that Romania is among the European countries that offer little fiscal incentives to support CSR platforms. Even there are companies (mainly in energy sector) that engaged in CSR activities, CSR still does not play an important role in Romania and it has not been subject to wider public discussion.
However, the concept of sustainable development and Corporate Social Responsibility (CSR) is reflected in the policies and strategies of the European Union (EU) and its Member States. Some governments are also promoting sustainable economic development and are introducing specific solutions to their tax system.
The study complied by Accreo Taxand presents information about Romania, Poland, United Kingdom, Spain, Greece, Finland, France, Belgium Ukraine and Norway. It provides a detailed analysis of the four major areas of the CSR concept, i.e. the business, environmental, employment and social area, as well as the related tax incentives used in the countries mentioned above. The report shows also that CSR still is a concept of voluntary integration of social and environmental concerns in business operations and that remains largely unregulated by law.
The Romanian tax law provides for certain tax incentives connected to research & development activities, such as: an additional tax deduction amounting to 20% of eligible expenses for such activities; application of accelerated depreciation method to the devices and equipment used in the R&D activities; and tax incentives for companies conducting research and development. In Finland, on the other hand, “corporate bodies are entitled to deduct money donations for the purpose of promoting science of EUR 850 – 50 000/250 000 depending on their designation.”
Regarding the sponsorship expenses, in Romania, these “may be deducted by the taxpayers for CIT purposes within the lower limit of 0.3% of their turnover or 20% of the profit tax due, provided that the sponsorship activity is performed according to the law. Such beneficiaries may be, inter alia, non-profit legal entities which perform in Romania or plan to conduct cultural, artistic, educational, scientific – fundamental and applied research, humanitarian, religious, philanthropic, sports, protection of human rights, healthcare activities, welfare and social services, environmental, social and community representation of professional associations, as well as maintenance, restoration, preservation and enhancement of historical monuments.” Furthermore, Romania Spain, France, Finland, Romania and Ukraine do not reward enterprises when they invest in new environmental protection technologies.
The majority of CSR activities in Romania are in social field and most of the time they take the form of sponsorship and charity, mainly, due to the incentives offered for this kind of activities. After evaluating the results of the survey, the report notes that “the selected European countries have introduced a number of initiatives to support the CSR activities. Nonetheless, there are still areas that could be of interest to both businesses and public institutions alike.” This seems to not be enough as the incentives offered by some countries are of little relevance to the daily business practice and thus fail to address the fundamental economic, environmental and employment concerns in the context of CSR.
Categories: Features & Analysis