Bulgarian Business Cries Foul over Flawed VAT Act
Bulgarian businesses have voiced their discontent over flaws in the country’s Value Added Tax (VAT) legislation that allow overtaxing diligent tax payers to make up for revenue lost from tax-dodgers.
If a company does not pay its VAT obligations, the due tax is then levied from at least five other companies along the transaction chain that are otherwise dutiful VAT payers, state-run Bulgarian News Agency quoted the chairman of the Bulgarian Industrial Association (BIA), Bozhidar Danev, as saying at a discussion panel held on Monday.
Danev said that for every 100 million levs ($63.3 million/51.1 million euro) in unpaid VAT, 500 million levs are collected from good tax payers.
This practice is due to the fact that no one is able to identify the companies that have failed to remit VAT.
BIA has sent to the National Revenue Agency information about more than 50 companies suspected of being letter-box businesses involved in VAT scams.