The latest World Bank Doing Business report suggests Romania now has a better environment in which to launch a business than Italy, Luxembourg, Sweden, Switzerland and other OECD economies.
With the report now in its 11th year, Doing Business 2014: Understanding Regulations for Small and Medium-Size Enterprises analyses the impact of regulations throughout the business lifecycle across 189 jurisdictions, ranking economies on the basis of 10 indicators including ease of starting a business, and paying taxes. Russell Bedford member firms have contributed to each of the report’s Paying Taxes survey since 2009, contributing data on tax regulation, recent reforms, and the real costs of tax compliance worldwide.
While Romania’s ranking for overall business friendliness remains unchanged (at 73rd out of 189), the country is ranked in 13th place for ease of obtaining credit, significantly ahead of Germany and Japan. It also shows improvement in a number of other areas, including contract enforcement, insolvency regulation and ease of paying taxes – moving up five places in this category, from 139th to 134th. Encouragingly, the report also suggests businesses are saving an average 16 hours per year in meeting their tax compliance obligations, down from 216 to 200 hours.
Andrei Badiu, partner in Russell Bedford member firm 3B Expert Audit SRL, commented: “It is highly encouraging to see Romania ranked among (and beating) our European peers. But our country’s ranking on access to credit does not reflect the high cost of credit experienced in reality by SMEs. Also, 200 hours per year is still too much for any SME to be spending on tax compliance, and regulators need to pay far closer attention to the real costs of this for small businesses and entrepreneurs.”