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Bulgaria to Adopt a 10% Flat Tax Rate

Wednesday, Aug. 1, 2007

Since Estonia adopted a flat tax rate in 1994, enjoying very robust GDP growth ever since, Eastern European countries have been gradually warming to this system that promises to attract foreign direct investment, increase transparency, and drastically curb tax evasion. Slovakia, Romania, Albania and many former Soviet republics have all adopted a flat tax.

Now it's Bulgaria's turn: yesterday, the government declared it will introduce a flat tax rate on personal income. At 10 percent, Bulgaria's flat tax rate will be among the lowest in the world, down from a tax rate that currently ranges between 20 and 24 percent.

Other countries with a flat tax regime are Macedonia, Ukraine, Mauritius, Mongolia and Russia. A full list can be found here.