In the context of the Republic of Moldova’s commitments under the Association Agreement concluded with the European Union in 2014 and its designation as an EU candidate country granted in 2022, the national legal framework is undergoing substantial reform. A large part of the legislative transposition agenda relates to environmental protection, which includes the adoption and implementation of numerous regulatory acts at the national level.
To ensure not only the transposition but also the enforcement and compliance with this expanding environmental framework, fiscal instruments have come to play a pivotal role. Among these, environmental taxation stands out as an essential mechanism to support regulatory implementation and promote disciplinary accountability.
Fiscal Instruments to Foster Environmental Responsibility
A particularly significant illustration of environmental taxation in Moldova is the regulatory framework sustaining polluter liability. Having its roots in the internationally recognized polluter-pays principle, first formulated by the OECD in 1972, Moldovan legislation charges polluters with the costs associated with the prevention and control of pollution, as determined by national competent authorities.
To ensure the application of this principle, the Moldovan tax system incorporates specific legal instruments aimed at placing the financial responsibility for pollution on the polluter, thereby incentivizing the rational use of natural resources. One of the earliest and most relevant examples is Law No. 1540 of February 25, 1998, on Payment for Environmental Pollution (Law No. 1540), which introduced pollution-related payments designed to hold accountable those responsible for environmental harm.
Although the payments introduced by Law No. 1540 are not formally classified as taxes under the Moldovan Tax Code, they entail all the essential characteristics of a tax, including (i) their mandatory nature, (ii) their amount and calculation method being determined by the state, (iii) their imposition being connected with a measurable benefit (namely, the use of natural resources), and (iv) their subsequent use for public-interest objectives.
In this respect, Law No. 1540 has established a practical system of environmental taxation, fulfilling the polluter-pays principle through fiscal measures.
Taxable Objects and Subjects
Law No. 1540 identifies specific types of polluting activities that give rise to fiscal obligations. These activities correspond directly to the environmental objects the law seeks to protect, namely air emissions, water discharges, soil contamination, and waste disposal and dissemination into the environment. For each of these categories, the legislation sets out the corresponding pollution charges, calculation methodology, and payment procedures.
As regards taxable subjects, any individual or legal entity carrying out economic activity in the Republic of Moldova and generating pollutants may be subject to the environmental charges provided by the law. As a general rule, the amount of the charge is proportionate to the volume of pollution caused, whether measured in terms of emissions, discharges, or waste quantities.
Recent Legislative Developments: Focus on Packaging Waste
To align with Directive 94/62/EC on Packaging and Packaging Waste, Moldova has introduced substantial amendments to Law No. 1540 and related legislation, aimed at clarifying the fiscal mechanisms applicable to pollution generated through packaging.These amendments introduce clear fiscal obligations for entrepreneurs who place packaged goods on the Moldovan market for the first time, whether for sale, distribution, or use in commercial activities, irrespective of whether the transaction involves payment.
The tax rate applicable to packaging waste depends on the material from which the packaging is made. Specific rates are provided for plastic, glass, wood, paper and cardboard, and metals (including aluminum), with the plastic packaging being subject to the highest tax rate. To ensure effective enforcement, secondary legislation adopted in 2025 established the applicable procedural rules. Notably, the legislation imposes a direct obligation on the polluter to identify the type and quantity of packaging waste placed on the market, report the material composition of such packaging, and maintain records of any recycling or recovery activities undertaken.
This self-assessment mechanism enhances the accountability of entrepreneurs and is designed to ensure compliance with environmental regulations. Thus, while not originally designed as having a tax statute, polluter charges have effectively evolved into a core fiscal instrument for environmental governance in Moldova, entailing a key element of the environmental taxation system.
By Carolina Parcalab, Head of Tax, and Doina Doga, Senior Associate, ACI Partners
This article was originally published in Issue 12.5 of the CEE Legal Matters Magazine. If you would like to receive a hard copy of the magazine, you can subscribe here.
