site.btaBulgaria Introduces R&D Tax Incentives, Industry Group Says

Companies will now be able to deduct an additional 25% of their research and development (R&D) expenses for tax purposes, after the National Assembly adopted on second reading amendments to the Corporate Income Tax Act, the Association for Innovation, Business Excellence, Services and Technology (AIBEST) stated in its position on the subject on Friday.

In it, the Association states that the legislative change is the result of AIBEST's long-term efforts to create a predictable and competitive environment for innovation and it puts Bulgaria in a better position compared to other European economies. They add that the amendments were achieved not only in cooperation with institutions but also with the support of the Bulgarian Employers' Association Innovative Technologies (BRAIT). 

They also state that the aim of the adopted changes is to accelerate the implementation of new technologies and products, to support the creation of highly qualified jobs and to increase the competitiveness of the Bulgarian economy. The introduction of tax incentives for R&D creates a stable foundation for long-term investments, a stronger innovation ecosystem and a better position of Bulgaria in high value-added chains in the European Union, the Association's announcement also states.

"This law creates conditions for R&D to develop as a sustainable structural element of the economy, rather than as an isolated practice. Predictability and clear rules are key for companies to plan long-term and expand high-value-added activities in Bulgaria," commented Yordan Ginev, Chair of AIBEST.

"The change is an extremely important moment for the Bulgarian economy. For years, AIBEST has insisted that without real economic instruments to encourage R&D, Bulgaria is lagging behind in the competition for investments, technologies and talents. Today, we already have a working framework that provides predictability to business and sends a clear signal that our country supports innovation according to European standards," said Nataliya Georgieva, Executive Director of AIBEST.