Cabinet Approves Amendments to 2014 National Budget Act, VAT Act

Cabinet Approves Amendments to 2014 National Budget Act, VAT Act

The government approved amendments to the VAT Act and the 2014 National Budget Act on Tuesday, Finance Minister Vladislav Goranov told a news conference.
The update proposal sets the budget deficit at 3.7 per cent of the projected GDP and additional debt financing at up to 4,500 million levs until the year's end. The bill of amendments to the 2014 National Budget Act was posted on the Finance Ministry's website on Monday evening.
To implement further consolidation measures targeting expenditures, the cabinet withdrew a budget update bill introduced into Parliament by the caretaker government, the new bill says.
The government expects further savings of about 120 million levs (0.2 per cent of the projected GDP) through savings by the ministries and departments after their expenditures are prioritized and optimized.
Some of the amendments to the VAT Act address the need to align the national tax legislation to EU regulations and directives, Goranov said. The Finance Ministry said that from January 1, 2015, all telecommunications, broadcasting, and electronic services supplied by taxable persons established in the EU to non-taxable persons established in the EU become taxable at the place where the customer belongs. The aim is to share VAT between the EU Member States where a company is established and the Member States where the service is supplied. 
The proposed amendments also transpose Regulation No. 360/2012 on the application of Articles 107 and 108 of the Treaty on the Functioning of the European Union to de minimis aid granted to undertakings providing services of general economic interest.
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