On Tuesday, September 10, the Ministry of Finance published draft changes in the VAT Act. Next year the state will introduce a regime of reverse charging of VAT, except for scrap material which is presently in force for grain and industrial crops. This measure is a short-term one and a lasting solution to the problem is needed in the form of long-term measures, such as strengthening of control activities not only in the production and trade of cereals and industrial crops, but also in their processing, so as not to shift tax frauds into the processing industry.
The Treasury is also preparing the introduction of a new voluntary scheme Cash Accounting of VAT. In this case only a payment for the transaction (an invoice including VAT ) makes it possible to claim a tax credit, and not as it is now, the invoice to give a legal reason for a credit claim without real transfer of money. The new system has many advantages, including improved liquidity in the real economy, reduction of inter-company debt and raising the morale of payments.
The new regime will not be not mandatory. It can be used only by companies with up to 1 million levs in annual turnover.
We are preparing also changes to the Tax Procedure Code, which will regulate the whole fiscal regime for the control over goods with high fiscal risk. Mobile groups and regional teams will be part of the new directorate which is expected to be operational early next year. The Fiscal Control Directorate will have the competence to operate in the entire country. The mobile teams will supervise fiscal control points located close to the border crossings with Greece and Romania. Regional teams will supervise inland establishments.
The mobile teams will have the power to stop vehicles and inspect the documents accompanying the goods carried. If transported goods are a with high fiscal risk a seal shall be affixed to the vehicle – a simple one or with a GPS device. The GPS seals can trace the path of the load. They will accompany the routes of very hazardous goods or goods of notorious for the revenue authorities provider. Regional teams will await in ambush the vehicle to the place of unloading of the goods. There, they will remove the technical means of control – and namely the seal. They, as a last stage of testing, will check the documents and actual quantities. They will also monitor the fast moving products such as fruit and vegetables, cereals and industrial crops, meat, sugar and confectionery, as well as metals.
The BANKER
