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The consumer

Consumer Profile
With a GDP per capita of USD 11,320 (IMF, 2021), the Bulgarian consumer is the poorest in the EU, but wealthier than most other nations in the Balkans. Bulgaria has an ageing and shrinking population as; in 2020, youth aged 0-24 accounted for 23.92% (est.) of the total population and in 2021 the natural growth rate is -0.67% (CIA World Factbook).
The consumer market is characterised by significant income inequalities with Bulgaria having the highest Gini index score among EU member states (40 points in 2020 - Eurostat).
Consumer Behaviour
Strong wage increases coupled with steady economic growth have reshaped the spending habits of Bulgarian consumers over recent years. City-dwellers in particular show growing interest in dining out as well as healthy and organic products (17% of Bulgarians state they have a strong interest in healthy lifestyles according to a national representative study - Knoema, latest data available). Bulgarian consumers prefer buying from local stores near where they live or work, despite the increasing presence of hypermarkets and general retailers (mostly of German origin).
Online shopping is also increasingly popular among Bulgarian consumers and it is expected that the compound annual growth rate for the next four years (2021-2025) will be 12.74%. The eCommerce market had a revenue of USD 712 million in 2020. More than half of the online population (58.3%) is expected to shop online by 2025 (Statistica). Nonetheless, e-commerce has considerable growth potential as its share in enterprises’ revenues is only 11%, the lowest in the EU (Eurostat - 2020).
Consumers Associations
Bulgarian National Consumers Association (BNACC)


Importing & Distributing

Import Procedures
Importation processes require:
- A customs declaration document
- A post-clearance examination of relevant documents or data
- Submission of an invoice or Pro-Forma invoice, a certificate of origin or a certificate of the movement of the goods in order to take advantage of preferential customs treatment, transport documents, an insurance policy, a specification, an Economic Operators Registration and Identification number (EORI) and a packing list
- A veterinary or physio-sanitary certificate for goods of animal or plant origin
- Other documents or laboratory analyses
- An EC Safety & Security regulation and the Advance Cargo Declaration are mandatory for all goods leaving, arriving or moving through the EC

A Bulgarian decree is required for the non-automatic licenses of nuclear materials, explosives, arms, dual-use commodities, plant protection products, and pharmaceuticals for human medicine. Bulgarian Customs exercises control over the export, import, re-export and transit of arms and dual-use goods and technologies.  Bulgarian regulations follow the EU list of dual-use goods.

For more information, please visit the website of Bulgarian Customs.
Distribution market players

According to Euromonitor International, the Bulgarian distribution market continues to be supported mainly by traditional and often independent grocery stores and stores, which are estimated at around 38,005. The more modern chain stores are growing slowly and there were about 3,301 in 2019.
The market is quite competitive, and the main distributors are:

  • Kaufland - market share estimated at 29% in 2019, according to USDA's latest data available (60 stores)
  • Lidl (99 stores)
  • Metro (11 stores)
  • Billa (130 stores)


Operating a Business

Type of companies

Ednolichen Tatgovetz or E.T. (sole proprietorship)
Number of partners: 1 person
Capital (max/min): No minimum capital required.
Shareholders and liability: No distinction between the individual and the society. The responsibility of the entrepreneur extends to his personal patrimony.
Druzhestvo s ogranichena otgovornost or O.O.D. (Private Limited Company)
Number of partners: Minimum 2 partners. 1 member for a sole proprietorship.
Capital (max/min): Minimum capital of BGN 2.
Shareholders and liability: Liability is limited to the amount contributed.
Aktzionerno druzhestvo or A.D (Joint-stock company)
Number of partners: Minimum 2 shareholders.
Capital (max/min): BGN 50,000 of which at least 25 % must have been paid at the time of incorporation.
Shareholders and liability: Liability on assets of the company and up to their value towards creditors.
Sabiratelno Druzhestvo ou S.D. (General partnership)
Number of partners: Minimum 2 partners.
Capital (max/min): No minimum capital required.
Shareholders and liability: Partners' liability is joint and unlimited
Komanditno druzhestvo ou K.D. (Limited partnership)
Number of partners: Minimum 2 partners, a sleeping partner and an active partner.
Capital (max/min): No minimum capital required.
Shareholders and liability: Active partners' liability is joint and indefinite. Sleeping partners' liability is limited to the amount contributed.
Setting Up a Company Bulgaria Eastern Europe & Central Asia
Procedures (number) 7.0 5.3
Time (days) 23.0 11.8

Source: Doing Business - Latest available data.


Cost of Labour

Minimum Wage
The minimum wage is BGN 650 per month in 2021 according to Eurostat.
Average Wage
According to data from the National statistical institute of the Republic of Bulgaria the gross average monthly wage was BGN 1,386 in 2020.
Social Contributions
Social Security Contributions Paid By Employers: Between 18.92% and 19.62% of wages according to the category to which employees belong.
Social Security Contributions Paid By Employees: 13.78% of gross earnings.

Intellectual Property

National Organisations
The organization for the protection of trademarks and patents is the Bulgarian Patent Office.
Since 1993, there is a law on copyrights and intellectual property. There is also a law on patents but it is not very reliable.
Bulgaria signed the Paris Convention concerning the protection of industrial property and the agreement which establishes the World Organization of Intellectual property (WIPO). Concerning patents, Bulgaria ratified the treaty of co-operation on patents.
Regional Organisations
The European Patent Office
International Membership
Member of the WIPO (World Intellectual Property Organization)
Signatory to the Paris Convention For the Protection of Intellectual Property


Tax Rates

Consumption Taxes

Nature of the Tax
VAT (value added tax) or данък върху добавената стойност
Tax Rate
Reduced Tax Rate
A 9% rate applies to certain hotel accommodation. Furthermore, in response to the COVID-19 crisis, the following services are temporarily subject to the 9% reduced rate (until 31 December 2022): restaurant and catering services; books and textbooks; baby foods and hygiene items; excursions organized by tour operators and tourist agents; supply of sport facility use services.
Zero-rated supplies include: exportation of goods; international transport and related services; intra-Community supplies; services related to the international traffic of goods; inward processing of goods (under certain conditions); supplies related to duty-free trade; intermediary services of agents, brokers or other intermediaries related to zero-rated supplies; supply of vaccines against COVID-19 and in vitro diagnostic medical devices intended for the diagnosis of COVID-19 (until the end of 2022).
Exempt items include: certain real estate transactions; leasing of residential buildings to individuals; financial services; insurance and reinsurance services; medical care services; education, cultural and sports services; betting and gambling; intermediary services related to international adoption procedures under the Family Code in Bulgaria.
Other Consumption Taxes
Bulgaria applies excise duty to alcohol (except for wine), tobacco and cigarettes, money games, petroleum, natural gas, kerosene and electricity (zero rate for electricity used by households).
For further information on excise duty consult the EU comparison table.
A tourist tax is levied at rates between BGN 0.20 and BGN 3 per night, depending on the type of accommodation.

Corporate Taxes

Company Tax
Tax Rate For Foreign Companies
Bulgarian residents are taxed on their worldwide income whereas non-residents are only taxed on their Bulgaria-sourced income.
Capital Gains Taxation
Capital gains are included in the taxable income of a company and taxed at the standard corporate income tax rate of 10%. Capital gains arising from the sale of publicly listed shares (on the Bulgarian stock exchange or any other European/EEA stock exchange) are exempt. From 2021, gains and losses on the disposal of shares listed on stock exchanges in third countries that are considered as equivalent to regulated stock exchanges and for which the European Commission has adopted a decision on the equivalence are also exempt.
Main Allowable Deductions and Tax Credits
Depreciation of tangible and intangible assets is tax-deductible at rates ranging from 4% to 50%. Goodwill cannot be amortised for tax purposes.
Start-up costs can be deducted in the first year of business activity. Interest costs and bad debt are also deductible. The deduction provided for borrowing expenses is limited to 30% of the company's tax-adjusted EBITDA (the limit only applies to net borrowing costs exceeding EUR 3 million per year). Donations to charities are deductible up to 10% of the company's profit.
Fines cannot be deducted from taxes, unlike taxes (except for corporation tax). Bad debt impairment costs can be deducted upon the expiration of the statute of the limitation period.
Tax losses can be carried forward for up to five years. Tax losses of foreign origin can only be offset by income from the same source (except losses of European origin which can be offset by any type of income). The carryback of losses is only allowed in certain cases.
Other Corporate Taxes
Social security contributions payable by the employer are between 18.92% and 19.62% (the rate varies according to the coefficient of the work injury insurance). This includes contributions for health insurance payable by the employer, at 4.8% of the salary. The base for the contribution is total income, up to a limit of BGN 3,400 per month (as from 1 April 2022; was BGN 3,000 per month between Jan-Mar 2022). Minimum thresholds per position and industry also apply.
A tax on insurance premiums is collected at a rate of 2% (life insurance, reinsurance, transport insurance are exempt).
The city tax due per night is between BGN 0.20 and BGN 3 (the amount varies depending on the type of accommodation).
The payroll tax is levied on remuneration, bonuses and certain benefits in kind at a rate of 10% (the amount retained by the employer).
The property tax varies between 0.01% and 0.45% of the taxable value of the property (the rate is determined by the municipalities). The transfer of real estate or vehicles is taxed at rates varying between 0.1% and 3% (rate determined at the municipal level).
Entertainment and representative expenses, sponsorships and business gifts, that do not bear the trade-mark of the donating company, are subject to a 10% one-off tax, same as for bonuses to staff, benefits in kind, and expenses for maintenance, repair and exploitation of cars.
A garbage collection tax also applies (at varying fees calculated by local municipalities).
Other Domestic Resources
Consult Doing Business Website, to obtain a summary of the taxes and mandatory contributions.

Double Taxation Treaties

Countries With Whom a Double Taxation Treaty Have Been Signed
See the list of the double taxation agreements signed by Bulgaria.
Withholding Taxes
Dividends: 0 (resident company)/5% (individuals and companies resident outside the EU/EEA), Interest: 0 (resident company)/8% (resident individual)/10% (non-resident individuals and companies resident outside the EU/EEA) , Royalties: 0 (resident company)/10% (individuals and companies resident outside the EU/EEA).