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Property tax assessments in Bulgaria to rise by 30% in 2027 and by 35% in each of the next two years

1 min read

Residential apartment blocks and low-rise houses with autumn trees in a city neighbourhood Real Estate
Residential apartment blocks and low-rise houses with autumn trees in a city neighbourhood

The government's tax package changes the Local Taxes and Fees Act for buildings, land and agricultural land; the final bills will depend on rates set by each municipality.

Owners of property in Bulgaria face higher tax assessments over the next three years under a package of tax law amendments approved by the government on 4 November, BTA reported. Under changes to the Local Taxes and Fees Act, the tax assessments of buildings, land, improvements and agricultural land will rise by 30% in 2027 and by a further 35% in each of 2028 and 2029.

The tax assessment is the value on which municipalities calculate the annual property tax. Higher assessments will raise owners' tax bills, with the actual amount depending on the rates set by each municipality, the government press office said. If the three increases are applied in full, assessments in 2029 would be about 2.4 times their current level.

The same package contains several measures that affect property and investment. Companies will be able to carry forward tax losses for 10 years instead of five, subject to a limit of 70% of their positive taxable result. The threshold for treating assets as long-term assets for tax purposes rises from BGN 700 to €1,000. The Local Taxes and Fees Act changes also remove the option for restaurant and entertainment businesses to pay a patent tax, after the European Commission said the measure was state aid.

The package also introduces a one-off 33% tax on excess profits earned in 2026 by banks, insurers, currency exchange offices, quick-loan companies, telecoms operators and food retailers with net sales of at least €5 million, with a 30% relief for purposes such as investment.

Other measures include higher child tax relief, a phased rise in the VAT registration threshold to €60,000 in 2027, €70,000 in 2028 and €75,000 in 2029, excise duty on combustion-engine cars of 250 kW or more, and mandatory electronic invoicing from 2028.

The amendments need to be passed by Parliament alongside the 2027 budget. For landlords and property investors, the change in assessments is a recurring cost that will grow each year to 2029.

Sources