Sofia, Bulgaria – The restaurant industry in Bulgaria is gearing up for a massive nationwide protest against the government’s decision to reinstate a 20% Value-Added Tax (VAT) rate for the sector.
Organized by the Bulgarian Hotel and Restaurant Association (BHRA), the Association of Restaurants in Bulgaria (ARB), and the Bulgarian Association of Restaurants (BAR), the protest is set to begin tomorrow with demonstrations planned in more than 30 regional cities.
The move to restore the standard VAT rate comes after the government temporarily reduced it to 9% during the COVID-19 pandemic to support the hospitality industry.
Restaurant owners and industry representatives argue that the increased tax burden will force many businesses into bankruptcy, exacerbate the shadow economy, and fail to generate the projected state budget revenues.
To voice their discontent, restaurateurs plan to block major roads and busy intersections across the country, disrupting traffic as a means of pressuring the government to reconsider its decision.
Organizers insist that the government has failed to engage in meaningful dialogue with the sector before pushing forward with the VAT increase.
Industry’s Demands and Concerns
Restaurant associations stress that Bulgaria remains the only European Union country that promotes tourism while not offering a reduced VAT rate for restaurants.
They argue that keeping the tax at 9% would foster economic stability, encourage compliance, and boost tourism-related revenue rather than pushing businesses toward tax evasion.
For months, the sector has been calling for discussions with government representatives to explore alternative solutions. Proposals include improved tax collection measures and sector-specific economic policies to enhance revenue without overburdening businesses. However, their requests for negotiations have so far gone unanswered.
“The restaurant industry is a key driver of Bulgaria’s tourism sector, providing thousands of jobs and contributing significantly to the economy. A drastic VAT increase will cripple small businesses and lead to higher consumer prices,” a spokesperson for the Bulgarian Hotel and Restaurant Association stated.
“9 Minutes of Darkness for 9 Percent VAT”
In addition to the street protests, the hospitality sector has launched a symbolic initiative dubbed “9 minutes of darkness for 9 percent VAT.” Under this campaign, restaurants, bars, and hotels will switch off lights and music for nine minutes at 9:00 p.m. each night. The action, running under the slogan “Politicians, preserve Bulgarian tourism!”, will continue daily until the National Assembly makes a final decision on the 2025 state budget.
Many in the industry hope that sustained pressure will push lawmakers to reconsider the tax policy. “We are not against paying taxes; we are against policies that will drive businesses into financial ruin,” said an ARB representative. “If the government does not listen to us, we will escalate our protests further.”
Potential Economic Impact
Economists warn that the VAT increase could have unintended consequences, including decreased consumer spending and job losses in a sector that employs thousands.
Some industry analysts also believe that the measure might fail to generate the expected state revenue, as higher taxes often lead to greater tax avoidance in the sector.
As protests commence, all eyes are on the Bulgarian government to see if it will engage in dialogue with industry representatives or proceed with the VAT increase despite mounting opposition.
This article was created using automation technology and was thoroughly edited and fact-checked by one of our editorial staff members