BIA PRESENTED STANDPOINTS ON THE DRAFT CHANGES IN TAX LAWS, PUBLISHED FOR PUBLIC CONSULTATION
The Bulgarian Industrial Association presented its standpoints on the draft changes in tax laws, published on the Public consultations portal. We present brief summaries of the individual standpoints.
On the Value Added Tax Act (VAT Act), BIA supports the proposed extension until 30 June 2024 of the deadline for the application of the zero rate of tax for the supply of bread and flour and insists on the extension of the deadline for the application of the reduced rate for the hotel and restaurant sectors. The Association supports the possibility created for the users of point-of-sale management software (POSMS) to generate and submit a fiscal receipt electronically. BIA does not support the proposed possibility for the recipient not to pay the value od the delivery when the supplier does not issue a receipt.
On the Personal Income Tax Act (PIT Act), BIA expresses reservations regarding the proposal for tax relief for fiscal receipts registered with the NRA and does not support the expansion of the scope of information provided by income payers regarding non-taxable income. "Providing information on all non-taxable income requires a significant change in the organization of financial and accounting reporting, especially for micro and small enterprises," is stated in BIA’s standpoint. There is also no support for the proposal to extend the definition of "employment relationship". BIA urges that this proposal be withdrawn as it is inconsistent with a number of laws and creates conditions for arbitrary interpretation, chaos, uncertainty and unpredictability for employers. BIA supports the removal of the tax on the sale or exchange of movable property transferred to persons who are authorized to collect, transport, recover or dispose of waste in accordance with the Waste Management Act - a change in the tax regime that our members have been calling for for over 10 years. The Association supports the proposed changes to Art. 3 of the Act in relation to the determination of taxable income from the sale or exchange of shares, units, compensatory instruments, investment vouchers and other financial assets, including virtual currencies, as well as from trading in foreign currencies to deduct 10% of statutory expenses.
On the Corporate Income Tax Act (CIT Act), BIA supports the proposals in relation to the introduction of a new state aid scheme for farmers, as well as amendments to Article 47a aimed at unifying the tax regime for financial institutions and non-financial enterprises. BIA calls for the introduction of the relief for substantial economic activity provided for in Council Directive (EU) 2022/2523, when introducing a national surtax to be levied on the constituent entities of a multinational group of undertakings located in Bulgaria or of a large national group of undertakings.
On the Tax and Social Security Procedural Code (TSSPC), BIA refrains from supporting the introduction of a financial incentive for persons who submit information containing specific facts and circumstances that were not known to the revenue authorities and lead to the establishment and collection of additional liabilities for taxes, mandatory social security contributions and interest thereon in connection with concealed and/or undeclared taxable transactions, income, profits and assets. BIA’s arguments are linked to those similar provisions exist in a number of other legal acts and that the revenue administration currently has a wide range of tools at its disposal to ensure effective control over the collection of tax revenues without the need to regulate additional financial incentives.
On the Excise and Tax Warehouses Act (ETW Act) BIA appealed to withdraw the proposal for a 100% increase in the excise rate for "independent small breweries" with an annual production of less than 200 000 hl of beer. According to BIA, the proposal is contrary to European legislation and will have a strong negative impact on all Bulgarian beer producers with the status of "independent small breweries".
On the Local Taxes and Fees Act (LTF Act), BIA supports the proposed exemption from real estate tax for buildings certified with energy consumption class "A" - for a period of 6 years, as well as for buildings with achieved technical requirements for "near-zero energy building", within the meaning of the Energy Efficiency Act - for a period of 10 years.
