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McGregor & Partners Newsletter – December 2015

In focus in Bulgarian legislation

Law on supplement of the Excises and Tax Warehouses Act (SG 92 as of 27.11.2015)

Review of the legislative changes:

  • the specific excise duty on cigarettes is reduced from 101 leva to 70 leva for 1000 pieces, while the proportional excise duty in 2016 will be increased, namely 38% of the purchase price, for 2017 – 40%, and in 2018 . – 42%;
  • the excise duty on gas oil and kerosene will be increased for 2016 from 50 leva to 646 leva for 1000 liter, and on heavy fuel oils and heating – from 50 leva to 400 leva for 1000 kg.

Bill of the Law on Amendments and Supplements of the Value Added Tax Act as of 17.09.2015

The Bill proposes the introduction of differentiated tax rate at 8 per cent for the medicinal products for human use, which are subject to medical prescription.

The arguments are that the changes will lead to a significant reduction of the prices of medicines in the pharmacies, which in turn will enable households to increase their spending to other goods and services.

News on European Union Law

An Action, brought on 14 September 2015 has been published in the EU Official Journal С 389, 23.11.2015, as Applicant is the European Commission and Defendant is the Republic of Bulgaria (Case C-488/15). On the basis of the latest annual report on air quality and also of the responses of the Bulgarian authorities to the reasoned opinion, the Commission takes the view that, at present, the Republic of Bulgaria has not fulfilled its obligations under Article 13(1) concerning compliance with the annual and daily limit values for the presence of micro-dust particles in the air (PM10) and under the second subparagraph of Article 23(1) of the Directive 2008/50/EC of the European Parliament and of the Council of 21 May 2008 on ambient air quality and cleaner air for Europe (OJ 2008 L 152, p. 1) with regard to the obligation to draw up air quality plans in order to keep the exceedance period as short as possible.

The Commission considers it necessary for the Court of Justice of the European Union to declare that the Republic of Bulgaria has infringed those provisions of the Directive.