In December 2025, a number of amendments to the Law on Value Added Tax (“LVAT”) were adopted by the Bulgarian National Assembly, entering into force on 1 January 2026.

The changes introduce a legal framework for the application of special VAT exemption regimes for small enterprises through the transposition of Directive (EU) 2020/285, clarify provisions in connection with the introduction of the Euro in the Republic of Bulgaria, implement new place-of-supply rules pursuant to Directive (EU) 2022/542, amend the special import VAT procedure in line with Regulation (EU) 2023/2831, and align national legislation with the case law of the Court of Justice of the European Union (Case C-388/18, Finanzamt).

In the present newsletter, we briefly review the main aspects of the newly adopted provisions and their practical implications for taxable persons operating in Bulgaria.