At first reading, Parliament approved higher tax reliefs for children and children with disabilities, a new relief for child development, and changes to corporate taxation. The amendments to the Personal Income Tax Act were supported by 191 MPs from all parliamentary groups.
Higher child tax reliefs
It is proposed that the amounts of the reliefs be permanently regulated in the Personal Income Tax Act, rather than being determined each year by the State Budget Act.
The relief for one child will increase to EUR 5,000, for two children – to EUR 10,000, and for three or more children – to EUR 15,000. A relief of EUR 12,000 is envisaged for a child with a disability. The option of using the amounts in advance during the year through the employer will remain in place.
The budgetary impact of the measure is EUR 137.5 million in lower personal income tax revenues.
New child development relief
A tax relief is also being introduced for actual and documented expenses on healthcare, education and sports activities for minor children.
Up to EUR 2,000 for one child, up to EUR 4,000 for two children and up to EUR 6,000 for three or more children may be deducted from the annual tax base. The expenses must be substantiated with documents proving the purchase and payment. The expected budgetary impact is EUR 93 million in lower personal income tax revenues.
The amendments also update the fines and property sanctions under the law, which have not been changed since 2007.
33% tax on windfall profits
At first reading, Parliament also approved amendments to the Corporate Income Tax Act. They provide for a one-off 33% tax on the windfall profits of companies in key economic sectors.
The proposal covers banks, insurance companies, telecommunications companies, currency exchange offices, consumer lending companies and food retailers with net sales revenue for 2026 of at least EUR 5 million. The texts were supported only by the governing majority, while the opposition voted against them.
The maximum monthly value of food vouchers is expected to increase from EUR 102.26 to EUR 200. The amount exceeding the current cap will be subject to a 7% tax, while the maximum annual quota for food vouchers is planned to reach EUR 1.5 billion as of January 1, 2027.
“This law is a step in the right direction,” said Nikolay Denkov of “We Continue the Change”. The bills are yet to be considered at second reading.
Sources: novini.bg, news.bg