site.btaGERB-UDF, Movement for Rights and Freedoms and Socialists Make It Clear They Won't Back Raising VAT for Restaurants Back to 20%

GERB-UDF and the Movement for Rights and Freedoms (MRF) - as well as the opposition BSP for Bulgaria, made it clear Wednesday they won’t be backing a proposed reinstatement of the 20% VAT for restaurants. The VAT for them was lowered to 9% to offset the impact of the COVID pandemic on this business. 

GERB leader Boyko Borissov told journalists in Parliament on Wednesday that no one has spoken to his party even through it is the largest in Parliament.

Reinstating the 20% VAT rate for restaurant business is envisaged in a package of legislation, drawn up by the Finance Ministry. The package will be published for public consultation "on Tuesday or Wednesday", said Finance Minister Assen Vassilev. "The tax rates for businesses and individuals will remain the same. The only change is the reinstatement of the pre-COVID VAT rate of 20% for restaurants,” said Vassilev. The minister said that the executive met with representatives of the restaurant business last week, who said that they will propose measures for bringing the sector out of the grey economy and increase insurance levels in the industry above the minimum working wage. 

Borissov said Wednesday: “We have said throughout the campaign that this type of business – restaurants, gyms, entertainment providers, the tourism industry, the hotels – they suffered the biggest blow from the coronavirus. They were literally crushed by the measures back then. This was the reason why the VAT rate was reduced in the first place."

Even before their leader spoke, MPs of GERB said September 26 that they were not going to back raising the VAT for restaurants. "There is no way we can back such a proposal for the simple fact that we have made a promise to our voters and we can't lie to them, especially when we have one-man decisions made by the Finance Minister without consulting GERB," said Dessislava Trifonova MP.

Delyan Peevski MP (Movement for Rights and Freedoms) said his party takes a firm stance against a 20% VAT for restaurants. 

Korneliya Ninova of BSP for Bulgaria said that her party would support keeping the 9% VAT for restaurants unchanged.

"No" to financial incentive for reporting tax fraud

Peevski also slammed the Finance Ministry's idea to offer financial incentives for people who report tax evasion to the authorities. "We see this as a repression. They will start filing false alerts to get their 10%," said he.

GERB's Borissov, too, said they would not support such a measure, and BSP's Ninova described it as "a wrong step".