The financial director of BIA Stanislav Stanislav Popdochev participated in a workshop during which were discussed the possible options for carrying out the insurance and tax payments after the Constitutional Court overturned the single tax account. The meeting was attended by the Deputy Minister of Finance Lyudmila Petkova, the NRA executive director Boyko Atanasov, chairman of the Budget Committee in the National Assembly Yordan Tsonev as well as heads of departments and representatives of employer’s organizations.
During the meeting, experts from NRA offered two options for decision:
1. Establishment of four accounts of public service obligations, respectively-for state taxes, contributions for government social insurance, health insurance contributions and supplementary mandatory pension insurance (the last exist at the moment);
2. Reservation of a bill for payment of all public debts without revealing additional accounts. This necessarily requires disclosure of payment type codes that will allow identify which public debt is extinguished. Along with this, before every payment people will have to submit an electronic or paper application, which indicates what they extinguish unless they want to apply logic pro rata repayment (if more than one).
Both options provide increased administrative burden on businesses. Through them, the number of payment orders for tax and social security payments increases from 2 to 4. In the latter case the risk of error in filling budget codes and subsequent unspecified payment is larger. In addition, individuals will need to submit an electronic or paper application in which one state liability extinguished. The participants in the meeting made further clarification that it is not possible parallel existence of one account and one of those options.
BIA is the first organization which proposed the idea of paying with a payment order, creating a single account and disclosure of tax information to insure companies in real time. Unfortunately, the idea was transformed in a way that has created numerous obstacles.
There are two proposed options from which BIA supports the first one-the creation of four separate accounts for debt servicing. In this way there will be less administrative burden and a decreased level of the risk of wrong and unspecified payments. It is also a prerequisite for better accountability of the revenue in NRA.
BIA expects the Treasury to send the social partners specific texts for amending the Tax Procedure Code.
NRA said they would continue to maintain electronic records for all declared and paid debts that were created to assist the business in 2013. Relief remains to be repaid first principal and then - interest on arrears. A transition period I expected where all available liabilities in the system will be automatically extinguished if the entity has funds in your account. If after that there is a remaining account, the company will have to decide to which subsequent obligations to be transferred.
