Romania to introduce tax on tips

Romanian government on Wednesday adopted an emergency ordinance according to which tips in restaurants or other service units will be taxed, Finance Minister Eugen Teodorovici told a press briefing.

According to him, the tips, thus the difference between the service provided and the customer's will to compensate the service, will be registered on a separate fiscal receipt and taxed by 16 percent.

The employer can decide what to do with the tips, namely to keep it or offer it to the employees, as an incentive, added Teodorovici.

The minister maintained that the employee has the obligation upon coming to the work place to register the amounts of money he has in a separate register kept by the employer and a fine will be charged, if more money is identified in the possession of the employee at spot checks of tax officials.

The official warned that check-ups will be intensified in the coming period, including during the May 1 short holiday.

Gratuities are seldom included in Romanian restaurants. It is customary to tip 10-15 percent on the total bill in the restaurant, as waiters are paid very low. Tipping is also customary for other service providers such as hairdressers, manicurists and taxi drivers.