In brief

  • The social insurance contributions that the Baptist Theological Institute of Bucharest withheld from its employees and paid, between 2011 and 2016, into the pension fund of its own denomination are deemed to have been paid in accordance with the law.
  • ANAF must issue the cancellation decision for the same amounts owed to the state social insurance budget, together with the interest, penalties and ancillary charges.
  • The decision must be communicated to the institute by 20 December 2026 at the latest, that is, within 160 days of the law entering into force.
Act: Law no. 126/2026
Published: Official Gazette of Romania (Monitorul Oficial) no. 570 of 10 July 2026
In force from: 13 July 2026

Parliament has written into law that the social contribution debt of a single institution, the Baptist Theological Institute of Bucharest, is extinguished for six years, and that ANAF must issue the cancellation decision by the end of 2026. The measure comes as the only addition made by Law no. 126/2026, published in Official Gazette of Romania no. 570 of 10 July 2026 and promulgated by Decree no. 383/2026, to the emergency ordinance that the law approves. It is the summer’s second act to wipe out tax obligations through a rule with a narrow addressee, after the one by which companies left without a VAT code escaped old debts.

The act being approved is Government Emergency Ordinance no. 107 of 4 September 2024, published in Official Gazette of Romania no. 905 of 6 September 2024, the fiscal and budgetary package that brought, in the autumn of 2024, the tax amnesty for interest and penalties. The law approves it with a single addition, one new article.

The factual situation set out in the text is simple. The Baptist Theological Institute of Bucharest withheld the social insurance contributions from its employees, but paid them into the account of the Pension and Aid Fund of the Baptist Christian Denomination in Romania, not to the state social insurance budget. As far as the tax authority was concerned, the obligation towards the budget remained unpaid, along with the ancillary charges that build up over a decade. The law settles this by declaring the payments made to the denomination’s fund to be lawful payments and by requiring ANAF to cancel the corresponding budgetary claim.

What it changes in practice

The first effect is the recognition of the payment. Paragraph (1) of the new article states that the tax obligations representing social insurance contributions paid on behalf of the employees by the institute, into the account of the denomination’s pension fund, in the period 2011-2016, are deemed to be obligations paid in accordance with the law. This is neither a rescheduling nor a reduction: it is a legal fiction by which a payment made to someone other than the budgetary creditor produces, retroactively, the effect of a payment to the budget.

The second effect is an obligation placed on the tax administration. Paragraph (2) leaves ANAF no room for discretion: the agency issues the decision cancelling the payment to the state social insurance budget of the obligations under paragraph (1), including the related interest, penalties and ancillary charges. The verb is in the present indicative, the form by which Romanian legislation expresses an obligation, not a possibility.

The third effect is a deadline. The decision is to be communicated to the institute by 20 December 2026 at the latest. Since the law enters into force on 13 July 2026, ANAF has 160 days. The text sets the deadline for communication, not for issuance, and provides nothing for the situation in which the deadline is missed.

The fourth effect is written nowhere, but follows from the first three: the money stays where it ended up. The contributions remain with the denomination’s pension fund, and the state social insurance budget gives up its claim. The act says nothing about the amounts involved, neither for the principal nor for the ancillary charges.

What has changed compared with the previous situation

Until this law, paying a social contribution to an entity other than the state social insurance budget did not extinguish the tax obligation. The institute appeared in ANAF’s records with a debt for the period 2011-2016, and interest and penalties had been calculated on top of that debt under the Fiscal Procedure Code. Enforced collection was, in principle, on the table.

After 13 July 2026, the debt is deemed paid by operation of law, and ANAF is obliged to acknowledge this through a decision of its own. It is a change of legal regime for a single taxpayer, named in the text of the law.

The path of the law itself has also changed. The form initially adopted by Parliament contained, alongside this addition, an income tax exemption for people earning gains from cryptocurrency transactions. The President asked for the law to be re-examined on 1 October 2025, criticising precisely that exemption, which he described as inopportune and as a risk of setting a precedent for tax avoidance. The text published now no longer contains the cryptocurrency exemption, only the addition concerning the institute.

What has not changed is the rest of the ordinance. The sole article approves it without any amendment to its provisions, even though the ordinance had already been in force for 672 days by the date the approving law was published.

Advantages and disadvantages

What it improves

  • It closes a situation that had been stuck for more than ten years, in which the amounts had actually been withheld from employees and transferred, but to the denomination’s own pension fund.
  • It does not leave the cancellation to the administration’s discretion: ANAF is obliged to issue the decision, and the taxpayer does not depend on a favourable interpretation.
  • It sets a communication deadline, so the institute knows by when it must receive the document.
  • It does not create a general exemption scheme, so it does not open up a new category of exempt taxpayers.

What remains a problem

  • The law settles the situation of a single, named taxpayer through a rule of legislative rank, which raises the question of what happens to other entities in the same factual situation.
  • The act does not say what amounts are cancelled, neither for the principal nor for the ancillary charges, so the cost of the measure for the social insurance budget cannot be established from the text.
  • It does not specify whether the period 2011-2016 counts as a contribution period in the public system for the institute’s employees.
  • The 20 December 2026 deadline has no consequence attached to it if ANAF exceeds it.
  • The wording “the decision cancelling the payment to the state social insurance budget” clumsily describes what is being cancelled, namely the payment obligation, not a payment already made.

Practical advice

  1. If you are or have been an employee of the institute in the period 2011-2016, ask the National Public Pension House for a certificate showing the contribution period recorded for those years. The law speaks about the institute’s obligations, not about the recording of the period in your own account.
  2. If you run an entity that has transferred contributions to a denomination’s own fund, do not assume the rule applies to you. The text names a single institution, and extension by analogy does not work in tax matters.
  3. The institute should keep track of the issuance of the decision, not only of its communication. The 20 December 2026 deadline concerns communication, and a decision issued late but communicated on time still complies with the letter of the law.
  4. Check the taxpayer record at ANAF after receiving the decision, to confirm that the ancillary charges have been extinguished as well, not only the principal. The text expressly includes them.
  5. If you are interested in the general measures in the approved ordinance, read it in its consolidated form. The approving law does not amend any of them.

Frequently asked questions

What does the law actually cancel?
The tax obligations representing social insurance contributions of the Baptist Theological Institute of Bucharest for the period 2011-2016, together with the related interest, penalties and ancillary charges, owed to the state social insurance budget.
Does it also apply to other denominations or other employers?
No. The text names a single entity. A tax rule with a determined addressee is not extended by analogy to other taxpayers.
Do the employees lose anything?
The law provides nothing about their situation. It declares the institute’s obligations paid in accordance with the law, but does not expressly say whether the period counts as a contribution period in the public pension system.
How much does the measure cost the budget?
The act does not indicate any amount. Neither the value of the principal nor that of the cancelled ancillary charges can be established from the published text.
What happens if ANAF does not issue the decision by 20 December 2026?
The law provides no consequence. The extinguishing effect is nevertheless produced by the law itself, from 13 July 2026, and the decision merely acknowledges it.
Does the law bring any other tax changes?
No. The sole article approves the emergency ordinance without any amendment to its provisions and adds only this new article.
What happened to the tax exemption for cryptocurrencies?
It was in the form initially adopted, which the President sent back for re-examination on 1 October 2025. It no longer appears in the text published in the Official Gazette of Romania.

Errors and inconsistencies in the published text

  • The sole article, the amending indent: Article XVI1, used as the reference point for placement, is not found in the ordinance. The law provides that “after Article XVI1 a new article is inserted, Article XVI2”. In the consolidated form of Government Emergency Ordinance no. 107/2024 published on the legislative portal of the Ministry of Justice, updated with the amendments made up to 14 October 2024 by Government Emergency Ordinances no. 112, 116 and 119 of 2024, the text goes directly from Article XVI to Article XVII, and the table of contents does not include an Article XVI1. The placement reference is therefore left without a target, and the consolidated form of the ordinance cannot be drawn up as the law requires. The natural correction is either to renumber the new article as XVI1, or to indicate Article XVI as the reference point.

Editorial analysis

The law solves a real problem. The amounts were not held back by the employer, but withheld from the employees and transferred, only into an account that was wrong from the budget’s point of view. In such a situation, enforced collection for a debt accumulated over a decade would have hit an educational institution for an error in the route the money took, not for evasion. Parliament’s choice to close the case has a logic to it.

What is missing is exactly what turns a one-off solution into a rule. The law does not say what amounts it cancels, even though the cost of cancelling a budgetary claim is, by definition, public expenditure. Nor does it say whether the factual situation is unique or whether there are other entities that transferred contributions to denominations’ own pension funds in the same period. If there are, they do not benefit from this law, because the text names a single addressee, and analogy does not work in tax matters. If there are none, the text could have said so.

The second observation concerns the employees, the only ones who do not appear in the text. A social insurance contribution is not only a claim of the budget, but also the basis for the contribution period of the person on whose behalf it was paid. The law declares the institute’s obligations paid in accordance with the law and, at the same time, requires ANAF to cancel the claim towards the social insurance budget. Combining the two means that no money enters the public system for the period 2011-2016, while the first provision would suggest that the obligation was honoured. Who decides, at retirement, whether those years count, and on what basis, cannot be established from the act.

The third observation concerns the calendar. The approved ordinance had been in force for 672 days by the date the approving law reached the Official Gazette of Romania, and in the meantime it had already been amended by three successive emergency ordinances, in September and October 2024. The approval therefore comes long after the real debate on the content of the ordinance had ended, and the only novelty the law brings has nothing to do with the subject matter of the ordinance.

What should be changed

  • The placement reference must be corrected. The new article should be numbered XVI1 or expressly placed after Article XVI, so that the ordinance can be republished in consolidated form without a gap in the numbering.
  • The text should say whether the period 2011-2016 counts as a contribution period. A single sentence would settle the question for all the institute’s employees and would spare the pension fund an interpretation it has no way of applying uniformly.
  • The cancelled amount should be indicated, at least as an order of magnitude. A cancellation of a budgetary claim without a figure can be neither verified nor compared with other measures of the same kind.
  • The deadline in paragraph (2) should be tied to the issuance of the decision, not only to its communication, and it should carry a consequence. As it is written, exceeding it produces nothing, so the deadline remains merely indicative.

Original text of the legal act

The text below is reproduced in Romanian, the official form of publication.

The full text, as published in the Official Gazette of Romania

Official Gazette of Romania no. 570 of 10 July 2026 8 pages PDF, 81 KB the act starts on page 2

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This article is for informational purposes only and does not constitute legal advice. For specific situations, consult a licensed attorney or tax advisor.