Bulgaria Fights New Greek Tax

April 9, 2015 Taxation in BulgariaTaxation in Greece

SOFIA – Bulgaria is claiming that Greece is implementing a discriminatory tax, which unfairly targets some countries with low corproate taxes, and will cost Bulgaria as much as EUR 800 million per year.

On April 8th Annika Breidthardt, a spokesperson for the European Commission, confirmed that the Commission has received an official complaint from Bulgaria against Greece’s proposed withholding tax on transactions originating from Bulgaria.

In April 2015 the government of Greece proposed a withholding tax of 26 percent on transactions originating from Cyprus, Ireland and Bulgaria, as these countries are deemed to have “preferential tax regimes”.

The proposed tax is intended to help the government of Greece fight the occurrence of tax evasion in the country.

It is currently estimated that the withholding tax will have an effect of reducing economic activity in Bulgaria by as much as EUR 800 million.

Currently 1 400 Greek companies are registered to do business in Bulgaria, and a significant number of Bulgarian companies export goods to Greece, and now both groups will fall under the scope of the tax.

The European Commission now has three month to consider the complaint laid by Bulgaria, and it may deemed that the tax is discriminatory should be dropped, with compensation to be made by Greece for any payments made.

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