September 2020 / Bulgaria

September 22 2020

Bulgaria, Netherlands sign new avoidance of double taxation treaty

Bulgaria’s Finance Minister Kiril Ananiev and the ambassador of the Netherlands to Bulgaria Bea ten Tusscher signed on September 14 a new convention for the elimination of double taxation with respect to taxes on income and the prevention of fiscal evasion and avoidance in the two countries, the Bulgarian Finance Ministry said. The current convention dates back to 1990 and was signed in circumstances of different economic relations between the two countries and when legal regulation of taxation in Bulgaria was different, the statement said. Bulgaria’s Finance Ministry said that the new convention is necessary also because of current changes in international taxation, initiated by the G-20 countries and the Organisation for Economic Cooperation and Development, to counteract the reduction of tax base and transfer of profits. The new guidelines in this field are present in the project Base Erosion and Profit Shifting – BEPS. The taxation regulations, introduced in the convention, are in conformity with current Bulgarian taxation legislation and the current principles and developments in international taxation, reflected in the OECD Model Tax Convention, the Finance Ministry said. “Such types of conventions are an important element of the international contractual basis and are of common economic interest, as they stimulate the economic and investment activities between the countries,” the ministry said.