Urban Rehabilitation VAT Rate Reduced to 6% Under New Law
Law No. 48/2026 clarifies that urban rehabilitation projects in legally designated ARU areas qualify for a 6% VAT rate, regardless of an approved ORU, resolving long-standing disputes over the previous tax regime.
Law No. 48/2026, enacted on August 17, 2026, provides legal clarity on the application of the 6% VAT rate for urban rehabilitation works under Article 2.23 of the VAT Code (CIVA). This amendment resolves ambiguity regarding projects conducted in Areas of Urban Rehabilitation (ARU) without a formally approved Urban Rehabilitation Operation (ORU), a point of contention from 2009 to October 6, 2023. The law ensures all rehabilitation activities within legally defined ARU zones are eligible for the reduced tax rate, enhancing administrative certainty for developers and municipalities.