INCOME TAX IN 2007
Tax preferences will be used on an annual base by all sources of income and not by income due to labour relations, economic activities and rent as it used to be so far. This is written in a draft of the Law on Taxes on Individuals Income adopted by the Council of Ministers last week.
Payments for voluntary pension and health insurance remain exempt from entry taxation. The amount of the tax preference as a percentage of the base remains up to 10%, however no BGN1,440 annual limit is introduced.
The range of income exempt from tax is expanded by the income from interests on deposits in banks and benefit societies in European Union member states. No tax will be imposed on income from interests of local banks and societies paid to foreign individuals.
The bill imposes normatively recognized expenses amounting to 50% for individuals occupied with artisan activities which are not subject to patent tax. The bill keeps patent taxation only in respect of individuals and sole-traders who are not registered under the Value-Added Tax Act.