[size=75:1r2sasel]novinite 22 December 2009

Bulgaria Plans to Cut VAT to 17% in 2011

Bulgaria's prime minister has announced that Value-Added Tax (VAT), which currently stands at 20%, could be cut to 17% in 2011.

Boyko Borisov spoke at the official lunch, organized by the American Chamber of Commerce in Bulgaria, dedicated to the country's plans for accession to the eurozone by 2013 and the efforts that the state is making to achieve this key goal.

“Bulgaria's accession to the eurozone will release huge financial resources, which are currently used to guarantee the stability of the currency board. This is money, which can be used in the health care system or invested in the construction of highways,” Borissov said.

He pointed out that Bulgaria is the only country, whose outlook was lifted to stable from negative by Standard & Poor's Ratings Services due to its strong track record of prudent fiscal policy and low gross debt.

Bulgaria has the lowest personal and corporate income tax in the EU at 10%, which was introduced at the beginning of 2008, replacing the previous system, which combined several different tax rates - between 20 and 24%, depending on income.

After coming into office, the new Bulgarian government announced it plans to keep unchanged the flat income tax rate and cut the Value-Added Tax (VAT) from the current 20% to 18% in 2010 and by a further 2% by the end of the term of office of Prime Minister Boyko Borissov’s administration.

The country will apply in March next year to join the exchange-rate mechanism, the two-year currency stability test prior to euro adoption, and seek to switch to the common currency by 2013.

Joining the exchange-rate mechanism would bring Bulgaria closer to the umbrella of the euro region and the protection of the European Central Bank and is conditional on whether the new government will succeed to restore Brussels trust.

The lev is already linked to the euro in a currency board that keeps the Bulgarian currency at 1.9558 to the euro. Joining the exchange-rate mechanism may allow the lev to fluctuate by as much as 15 % around a central band, though the central bank has said it will leave the lev tightly pegged to the euro through the duration of the two years.

Great news if it happens? lets all keep our fingers crossed that the VAT goes down

this has been bantered about in the papers for some time now..lets hope it happens

[size=75:3a0jtgfe]novinite 23 December 2009

Bulgarian Experts Propose 5% VAT Cut

A day after Bulgaria's prime minister promised that Value-Added Tax (VAT), which currently stands at 20%, could be cut to 17% in 2011, experts have called for sharper decreases.

“VAT levels could be cut not by three, but by five percent in 2011,” Georgi Stoev from the Bulgarian economic think-tank Industry Watch told Darik radio, adding that the move won't hurt the flow of revenues to the state budget.

According to him the government has randomly selected the proposed cut, because calculations show that the reduced rate can be 5%, decreasing the VAT to 15%. The EU law requires that the standard VAT rate must be at least 15% for supplies of goods and services.

Bulgaria has the lowest personal and corporate income tax in the EU at 10%, which was introduced at the beginning of 2008, replacing the previous system, which combined several different tax rates - between 20 and 24%, depending on income.

After coming into office, the new Bulgarian government announced it plans to keep unchanged the flat income tax rate and cut the Value-Added Tax (VAT) from the current 20% to 18% in 2010 and by a further 2% by the end of the term of office of Prime Minister Boyko Borissov’s administration.

As you say varnagirl they have been talking about this for years but doing it maybe another thing all we can do cross our fingers and everything else

VAT - What a con.

[size=75:1gh4k1rv]novinite 22 March 2010

Bulgaria to Up VAT to 22% for 1 Year

Value Added Tax (VAT) will be increased to 22% for 1 year, according to the last draft of the cabinet's anti-crisis measures, the labor unions economic expert, Mika Zaikova, informed.

Zaikova reported the news Monday speaking for the Bulgarian National Radio (BNR), voicing her surprise from the move, which had never been discussed before.

The increase will bring an additional BGN 540 M to the State budget.

On Tuesday, the National Council for Three-Way Partnership will discuss the last version of the anti-crisis package. Zaikova further informs the measures are 39, of which 20 come from the proposals of the labor unions and the employers. These measures further include wage reductions if there aren't any layoffs.

Prices of electricity, heating and gas are not going up, the expert says, adding the cabinet wants to privatize the Sofia Heating Utility “Toplofikatsia” and the National Palace of Culture in the capital.

VAT was introduced in Bulgaria in 1994 at 22% and was reduced down to 20% 10 years later. Business experts have long insisted VAT is further lowered with another 2% in other to stimulate consumers.

The country is being crippled by the world crisis so they increase the vat? are they having a laugh

[size=75:3rer9vfd]novinite 25 March 2010

Bulgaria Tourism Sector Cries Foul over VAT Hike

Bulgaria's government plans to increase the value-added tax by 2 percentage points to to 22 percent triggered vehement opposition by representatives of the tourism sector, saying the move will be detrimental for them.

“Bulgaria's revenues from foreign tourists amount to EUR 2,5 B per year, which means that the tax hike may incur losses worth EUR 50 M,” Lyubomir Pankovski, executive director of Alma Tour travel agency, told Pari daily.

Experts say a possible VAT increase will trigger a domino effect in the sector, which will bring about an increase in prices of the final packages offered to travelers and make Bulgaria highly uncompetitive in comparison with its neighbors.

“Our expenses will grow and we will look for ways to make them up either by increasing prices or laying off people. These measures can only hurt the quality of the services offered and will undermine the sector,” Rumen Draganov, director of the Institute for Analyses and Assessments in the Tourism Sector, commented.

To top it all off experts say early bookings and already signed contracts will all fail if the VAT hike scenario unfolds.

Bulgaria's new center-right government plans to introduce a new tax on luxury goods, increase the value added tax to 22 % and cut public servants wages in a bid to help fight the economic crisis and keep down the fiscal deficit.

It is part of a package of new measures, which also include floating minority stakes in state-owned companies and a possible bond issue.

The government is expected to agree with the trade unions and the union of employers this week a final package of nearly 50 steps to combat the crisis.

Representatives from all business sectors have cautioned that the hike in the value-added tax in Bulgaria should be a last-ditch measure that should only be introduced together with an overhaul in government expenditure.

[size=75:plot1l07]novinite 29 March 2010

Bulgaria Govt Makes U-Turn over VAT Tax Hike

Bulgaria's center-right government has dropped plans to increase the value-added tax by 2 percentage points to to 22 percent, reports say.

“The value-added-tax will not be increased for the time being,” Bozhidar Danev, head of the Bulgarian Industrial Association, told journalists after a meeting of representatives of the cabinet, labor unions and employers.

The government planned to increase the value added tax to 22%, introduce a new tax on luxury goods and cut public servants wages in a bid to help fight the economic crisis and keep down the fiscal deficit.

It is part of a package of new measures, which also include floating minority stakes in state-owned companies and a possible bond issue.

The government is expected to agree with the trade unions and the union of employers a final package of nearly 50 steps to combat the crisis.

Representatives from all business sectors have cautioned that the hike in the value-added tax in Bulgaria should be a last-ditch measure that should only be introduced together with an overhaul in government expenditure.

Bulgaria has the lowest personal and corporate income tax in the EU at 10%, which was introduced at the beginning of 2008, replacing the previous system, which combined several different tax rates - between 20 and 24%, depending on income.

After coming into office, the new Bulgarian government announced it plans to keep unchanged the flat income tax rate and cut the Value-Added Tax (VAT) from the current 20% to 18% in 2010 and by a further 2% by the end of the term of office of Prime Minister Boyko Borissov’s administration.