Senior officials from Greece and Bulgaria met on January 18, 2018, to discuss ways to tackle base erosion and profit shifting by certain Greek businesses, who transfer their headquarters to Bulgaria to benefit from a low corporate tax rate in Bulgaria.
The meeting took place in Athens between Giorgos Pitsilis, the Governor of Independent Authority for Public Revenue, and his Bulgarian counterpart, Galya Dimitrova. The meeting was aimed at widening cooperation between the two tax administrations in the fields of exchange of tax information and tax avoidance.
According to Greece’s Public Revenue Authority, the issue of tax avoidance by Greek companies, who fictitiously transfer their tax base to Bulgaria, was at the heart of the discussions. The effectiveness of the existing tax treaty between the two countries was examined with a view to safeguarding the interests of both countries from abusive tax practices.
The Greek corporate tax rate is 29 percent, nearly three times higher than Bulgaria’s 10 percent corporate tax rate.