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NOVA learned that the lowest VAT for restaurants can take effect on June 1. A final decision on the matter was expected on Wednesday, but negotiations are ongoing.
Tax changes and extraordinary measures for the catering industry (SUMMARY)
The lower tax rate will not lead to lower prices on the restaurant menu, because the idea is free money to help the industry survive without raising prices. The owners welcomed the idea of the measure taking effect this summer, as they believe it will prevent the bankruptcy of many restaurants and bars, which even now cannot be opened. Staff reductions will also be avoided.
Industry accounts have shown that a lower value-added tax of 9%, rather than 20, will not benefit the end customer.
Richard Alibegov: restaurant prices will be frozen
“It is enough not to increase prices, there are 4 more serious price increases in our industry. This measure will probably allow us to freeze these prices and invest in our staff to prevent them from traveling abroad.” said Richard Alibegov, president of the Restaurant Association in Bulgaria.
And for establishments to survive, the new VAT must be introduced now, says NFSB President Valeri Simoenov.
“It is more than obvious that the coronavirus has dealt the strongest blow to this industry. And it is natural to give these people the opportunity to partially compensate for the losses they have suffered, and not to give them to them since January 1, 2021, when they have been gone, “he said.
Valeri Simeonov: VAT reduction for the restaurant business is a temporary measure
“It is very important to see when VAT will come in, because bankruptcies and layoffs are right now. A large part of the industry has not yet opened, and a large part of our colleagues have already filed for bankruptcy,” added Alibegov. . And in return, the industry promised to brighten up the business and not less cash flow.
So far, the measure is not being discussed for other industries. Coalition partner Valeri Simeonov also approached the opinion of the Minister of Finance with understanding, who does not approve of the VAT deduction for restaurants.
The restaurant industry: we wanted 5% VAT, but we are also satisfied with 9%
“I have a lot of respect for Goranov and I think he is a true patriot because he cares about the state budget. His behavior is absolutely appropriate, even in this crisis,” he said.
The measure will cover almost 95% of the establishments, according to the classification of the tourism law. And what the effect will be for the industry depends on when the lower VAT will be introduced. However, the exact date is still being discussed.
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