EU extends Romania’s 50% vehicle VAT deduction restriction to 2029

The decision preserves Romania’s authority to limit deductible VAT to 50% on the purchase, intra-Community acquisition, import, hire or leasing of covered vehicles, and on related expenditure. It changes the expiry date in Decision (EU) 2024/1641 from 31 December 2026 to 31 December 2029; it does not create a new percentage restriction.^[1][2]

Scope remains tied to the 2024 authorisation

Decision 2024/1641 excludes vehicles exceeding 3,500 kilograms maximum permissible laden mass or having more than nine seats, and specified categories including vehicles used exclusively for emergency or security services, sales agents, passenger transport or paid services. It also authorises Romania not to treat covered vehicles’ non-business use as a supply of services for consideration.^[2]

Practical effect

Romanian VAT-registered businesses using covered vehicles avoid the scheduled end-2026 expiry of the EU authorisation. They should continue testing vehicle use and the stated exclusions under Romanian law. The EU decision does not establish domestic return fields, bookkeeping treatment or a new filing deadline.^[1][2]

Further extension

Decision 2026/2495 takes effect on notification to Romania. Any request for another extension must be submitted by 31 March 2029 with a report reviewing the percentage limitation. The published decision does not state the notification date, so no separate commencement claim is made.^[1]