February 25 2020

Amendments to VAT Act – approved by parliament

Source: IBFD Tax Research Platform News

On 19 February 2020, the parliament approved at second (final) reading amendments to the Value Added Tax (VAT) Act. The amendments concern the transfer of greenhouse emission allowances (based on Directive 2003/87/EC of 13 October 2003 establishing a scheme for greenhouse gas emission allowance trading within the Community and amending Council Directive 96/61/EC).

The allowances traded are included in the list of supplies to which the domestic reverse charge mechanism applies.

The amendments also provide that, in cross-border situations where a Bulgarian person is engaged in emissions trading with a supplier/recipient established in another country, the general VAT rules will be applicable.

This reverse charge regime will apply until 30 June 2022.