Bulgarian Cabinet approves draft agreement to update tax treaty with Romania

Bulgarian Cabinet approves draft agreement to update tax treaty with Romania

Sofia, April 23, 2015/ Independent Balkan News Agency

By Clive Leviev-Sawyer of The Sofia Globe

Bulgaria’s Cabinet has approved a draft proposal to update the memorandum on avoiding double taxation and tax avoiding with Romania, replacing the current agreement signed in 1994, the government media service said.

The draft approved on April 22 is the second one approved by a Bulgarian cabinet is the space of one year. In April 2014, another draft agreement was given green light by the now-departed administration of Prime Minister Plamen Oresharski, which also mandated then-finance minister Petar Chobanov to negotiate the final terms.

Oresharski and his Romanian counterpart Victor Ponta had discussed the issue at a joint meeting of the two governments in November 2013. The current agreement was signed “under different economic conditions and legal regulations in the area of taxation,” according to the Bulgarian Government.

The new agreement, in line with the guidelines of the Organisation for Economic Co-operation and Development, will apply an entirely new model of distributing the tax burden, which will help improve bilateral relations, stimulate economic co-operation and investment, the Government’s press service said, without giving further details.

The new tax treaty will be signed and will be subject to ratification by Parliament, the Government’s media service said, without giving further details on the timing of the signing.