Another tax increase - this is the intention of the government of Rumen Radev, and there is a proposal on the subject. This is the tax on expenses related to assets provided by the company for personal use to workers, employees, members of the management and control boards or partners. This tax is better known as the weekend tax, writes the newspaper "Sega".
The tax was invented years ago to stop the practice of buying cars for personal use, but with company registration and thus save on paying 20% VAT.
This tax also taxes the personal use of company property, computers, telephones and other assets.
When the tax was introduced, it was 10%, but in 2022 it was reduced to 3%, during the government of Kiril Petkov. Now "Progressive Bulgaria" (PB) proposes to increase the tax to 7%.
According to PB, a 3% tax is actually 2.70. This compromises this regime and leads to unjustified losses for the budget in large amounts, says the explanatory memorandum to the bill, which was drafted by the Ministry of Finance. However, they lack a specific estimate of the losses suffered by the budget at the current 3% rate, and there is no specified amount for expected additional revenues from the tax change.
A special simplified procedure has been provided for the application of the "weekend" tax, with companies having the right to choose whether to pay it themselves under the Corporate Income Tax Act or to charge the expense as income in kind to the employee himself under the Personal Income Tax Act, the Ministry of Finance recalls.
Employers overwhelmingly prefer to pay the tax instead of qualifying the use of company assets for personal needs as remuneration for employees, as this leads to a fairly large administrative burden.