The Ministry of Finance has published a proposal to amend the Value Added Tax Act and Excise Duties and Tax Warehouse Act (EDTWA) for public consultation.
The main changes to the VAT Act suggested are the following:
- introducing deferred payment of import VAT in the case of centralized clearance when importing goods;
- introducing a measure allowing taxable persons that have not registered for VAT purposes in a timely manner to issue tax documents that include the applicable VAT for the periods for which they should have been registered;
- prolonging the 0% VAT rate for supplies of bread and flour until 30 June 2024; and
- introducing a measure allowing the recipients of supplies to withhold payment if the supplier fails to provide a fiscal receipt at the time of the transaction.
The amendments to the Regulations for the application of the VAT Act introduce new reporting obligations for payment service providers. These obligations cover the formatting and submission procedures for information related to cross-border payments. The electronic form must meet the requirements provided in the Commission Implementing Regulation (EU) 2022/1504 of 6 April 2022. This Regulation lays down detailed rules for the application of Council Regulation (EU) No. 904/2010 regarding the creation of a central electronic system of payment information (CESOP) to combat VAT fraud. The information from the register must be submitted with a qualified electronic signature following the guidelines set out in the Tax and Social Security Procedure Code. The submission must be made through a standard electronic form outlined in Implementing Regulation (EU) 2022/1504. The Executive Director of the National Revenue Agency must approve the format, structure and validation scheme of the file.
The main proposals to the Excise Duties and Tax Warehouse Act (EDTWA) are the following:
- extending the scope of goods subject to excise duties by including the heated products with content other than tobacco, based on plants, herbs or fruits, regardless of whether they are treated with nicotine. From 1 January 2024, these products will be subject to an excise duty rate of BGN 331 per kilogram;
- introducing a regime for distance sales of excise goods released for consumption in Bulgaria which are sent to individuals in other EU Member States; and
- introducing various clarifications for customs formalities as outlined in the Union Customs Code. These clarifications specifically relate to goods subject to excise duties that are dispatched to or received from certain third countries.
The public consultation, issued on 26 September 2023, run until 26 October 2023.