Romania suspends tax on new cars

BUCHAREST — The Romanian government will suspend a tax on new cars to protect jobs in the auto industry, which has been hit by the world economic crisis, Prime Minister Calin Popescu Tariceanu said Wednesday.

Tariceanu said the government will ask the European Commission to allow the measure, which he wants to run until the end of 2009.

He made his announcement after meeting President Traian Basescu, who also said he wants to scrap the tax to protect jobs.

Dacia said last week it would halt production from Nov. 20 to Dec. 7 because of the financial crisis which has led to a 30 percent drop in cars sales in October compared to a year ago. Dacia's 14,400 workers will get 85 percent of their salaries during the production halt.

On Monday, Basescu visited Dacia and said he would support the suspension of the tax.

Dacia said its market shrank also because of "the invasion of imported secondhand cars" and warned that jobs in the car industry are in danger.

Wednesday, Subansamble Auto, a company that supplies parts to Dacia said it would send home 800 of its 3,500 workers.

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French-Romanian carmaker Dacia halts production

Associated Press

Thu Nov 20

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