4. The taxable object
read Art. 24
Four kinds of taxable events exist under the Bulgarian VAT legislation.
- taxable deals
- import of goods
- performance of services in Bulgaria by person, whose place of business is
outside the country (art 33 VATA)
- cancellation of VAR registration (art 17 VATA)
4.1 Taxable deals
Defined as "all deals within the scope of VAT, which are not exempt
deals or export deals" (art 3 VATA).
This definition requires some additional explanations:
A deal "in the scope of VAT" is every deal, though which a
"business activity" is performed and whose place of performance is in
the territory of the country, including the continental shelf and the exclusive
zones, without the duty-free zones, entrepot stores and duty-free trade stores
(art 3 VATA)
Exempt deals are explicitly listed in VATA. There are 2 types of exempt
- permanently exempt deals
- transfer of ownership on land - art 34
- financial and insurance services - art 36 and 37
- educational and health services
- cultural and welfare services - art 38 and 39
- hazard games (betting and gambling
- museum tickets - art 52
- library services - art 42, 4 + 5
- zoos and botanic gardens - art 52 (2) - 4
- art galleries and theatres
- lawyer services (legal services)
- renting (optional) - see 11.3
- temporarily exempt deals (may be replaced by other products)
- sales of bread, cow milk, Bulgarian yogurt, white brined cheese
- electricity, heating of houses, wood and coal for the population
- text books
The reasons for the exemption of these two types of deals are
For the first type (permanently exempt) the reasons are:
The second group is exempt through some social and political reasons and the
exemption of the deals included in it creates distortions in the price system
and possible cumulative effects. The exemption term is 3 years after
entering into force of the VATA (until 01.04.97).
Export deals (3 types) - art 14
- Transfer of ownership over goods transported by the performer of the
deal or on his account in the duty-free zones, entrepot stores or outside
the territory of the country.
- Rendering services connected to activities performed by the receiver to
the deal outside the territory of the country.
- International transport (goods and passengers)
Export deals will be explained in detail below.