Bulgaria Extends Temporary Reduced Rates

In a recent decision, the Bulgarian parliament has extended the 0% VAT rate on bread and flour until 31st December 2024. This extension continues a measure first introduced in July 2022 as part of an "anti-crisis package" aimed at alleviating economic pressure on consumers.

Originally, the VAT reduction was set to expire on 30th June 2024. However, recognizing the ongoing financial challenges, the Government decided to prolong this tax relief for an additional six months.

This extension is part of broader efforts to ensure economic stability and protect vulnerable populations from rising living costs. The government hopes that by reducing the tax burden on staple foods, it can provide much-needed relief to consumers and contribute to the overall economic resilience of the country.

In addition to the extension for bread and flour, the parliament has approved several other reductions and extensions of current VAT rates:

• Restaurant and Catering Services: The VAT rate for supplies in the restaurant and catering sector will remain at a reduced rate of 9% until 31 December 2024, instead of the previously planned 31 December 2023.
• Tourist Services and Sports Facilities: The reduced 9% VAT rate on tourist services and services related to the use of sports facilities will be extended until 30 June 2024, rather than ending on 31 December 2023.

These measures are part of a comprehensive effort to mitigate the economic impacts of recent crises and provide sustained support to various sectors of the economy. The continuation of reduced VAT rates aims to stimulate consumption, support businesses, and maintain economic stability in Bulgaria.

Please visit the Bulgarian Tax Authorities official website for more detailed information on VAT rates and legislative changes.