CHANGES TO THE LOCAL TAXES AND FEES ACT
Changes have been introduced to the Local Taxes and Fees Act (Reference: State Gazette # 106 of December 3, 2004). The changes are effective as of January 1, 2005.
Effective from 2006 local taxes will be paid in favor of the municipality authorities instead of to the tax authorities, as is the current practice.
1. THE ROAD TAX HAS BEEN ABOLISHED
2. TAX ON REAL ESTATE
The enterprises, which are obliged or have chosen to apply the International Financial Reporting Standards as of January 1, 2005, have to submit a declaration regarding any changes in the circumstances already declared (e.g. changes in the book value of an immovable property) by June 30, 2005.
3. INHERITANCE TAX
Spouses or straight line heirs without restrictions are not liable to inheritance tax.
The current progressive scales for determining the inheritance tax for collateral and other heirs has been replaced by flat rates as follows:
• For brothers, sisters and their children – 0.7 per cent for inheritance share over BGN 250.000.
• For other heirs – 5 per cent for inheritance share over BGN 250.000.
4. TAX ON PROPERTY ACQUIRED UPON DONATION OR AGAINST CONSIDERATION