The global minimum tax: a new challenge for multinational groups in Romania
14 November 2025
The principles for implementing the Global Minimum Tax (Pillar Two) were developed by the Organisation for Economic Co-operation and Development (OECD) to prevent the erosion of tax bases in countries where multinational groups operate and to curb profit shifting to jurisdictions with favourable tax regimes.
The purpose of Pillar Two is to ensure that multinational groups are subject to a minimum effective tax rate of 15% in each jurisdiction where they operate.
The principles of Pillar Two were transposed into Directive (EU) 2022/2523, which was adopted in December 2022.
The implementation of Pillar Two in Romania
Directive (EU) 2022/2523, transposed into Romanian legislation through Law 431/2023, sets out rules and a framework for implementing a global minimum level of taxation for multinational enterprise groups and large-scale domestic groups operating in Romania.
Starting in 2024, the new requirements apply to Romanian companies that are part of multinational groups with annual consolidated revenues of at least €750 million, recorded in at least two fiscal years during the period 2020–2023. Certain entities are exempt, including governmental bodies, nonprofit organisations, pension funds, investment funds, and others.
The calculation of the effective tax rate is performed on an aggregate basis for all group entities resident in Romania and represents the ratio between the entities’ adjusted covered taxes and their qualified net income. If the resulting effective tax rate is lower than 15% for a financial year, the group is required to pay a top-up tax.
Romania has exercised its right to apply the national top-up tax, under which the tax owed by undertaxed groups in Romania will be collected at the local level.
For 2024, the filing and any potential payment of the national top-up tax must be completed within no more than 18 months from the last day of the reporting fiscal year, with the deadline set at 30 June 2026 for groups that apply the calendar year.
The Romanian Pillar Two legislation also regulates transitional safe harbour regimes, applicable to groups that prepare and submit the Country-by-Country Report (CbCR). The top-up tax will be zero if, based on simplified calculations using the CbCR data for 2024, the Romanian entities meet the conditions for at least one of the three tests (i.e., the de minimis test, the simplified effective tax rate test, or the routine profits test).
Recommendations
Although the deadline for filing and payment is approaching (30 June 2026), there are several key aspects of the legislation that the authorities have yet to clarify - such as the issuance of the Implementing Rules for Law 431/2023 or the publication of the national top-up tax return that must be submitted. This lack of clarity complicates the process of accurately determining the impact at the level of each company.
Romanian companies that are part of multinational groups falling under the scope of Pillar Two should begin analysing the impact of the new legislation. The analysis should first focus on identifying the Romanian entities subject to the law and assessing the extent to which they may qualify for the transitional safe harbour regimes.
If the simplification measures cannot be applied, groups and Romanian companies will need to collect and process a substantial volume of information and gain a detailed understanding of how to apply the necessary adjustments for calculating the relevant indicators, in order to determine the effective tax rate.
Groups that have two or more entities in Romania may already choose to submit the N408 notification to designate one Romanian entity to fulfill the Pillar Two reporting and payment obligations on behalf of the other Romanian entities. The deadline for exercising this option is 31 December 2025, for the 2024 fiscal year.
