In the European Union’s fiscal map, Romania can still be considered competitive when it comes to taxes, at least when it comes to taxing profits, through its 16% flat tax rate. Yet when it comes to taxing labour, things are different. Through social contributions and the payment ceiling – established in a strong redistributive way at 5 times the average gross wage – wage taxation becomes suffocating. This inhibits job creation and perpetuates undeclared work in an explicable way. In this context, the reduction of social security contributions for the employer appears to be fully justified. This is, in fact, a policy change constantly demanded by the business environment. But how much will every percentage point of reduction in social security contributions “cost” the budget?