Bulgaria’s Parliament adopted at first reading to raise VAT registration threshold from BGN 50 000 to BGN 100 000

Bulgaria’s Parliament on July 8 unanimously adopted at first reading to raise the VAT registration threshold from BGN 50 000 to BGN 100 000.

The change will enter into force on 1 January 2023. The draft amendments were tabled by “Democratic Bulgaria” with the motives that this would reduce the administrative burden, increase the competitiveness of small businesses, start-ups and people with freelance professions.

The direct losses to the budget will be between 85 million and 130 million BGN, but the indirect economic effect will exceed the losses to the budget, will strengthen the Bulgarian economy and will increase the revenue collection rate. The proposal to raise the threshold to BGN 166 000 in 2024 was withdrawn on the grounds that in this case the European Commission's authorisation would be required.

Parliament adopted a 3-day deadline for proposals on the law between the first and second reading.