Large-scale bankruptcies of guesthouses expected

Raya Atanasova

“The introduction of the new tax in the tourism sector will severely affect guesthouses,” Lyubomir Popyordanov, Chairman of the Bulgarian Association for Alternative Tourism, said before the opening tomorrow of the largest tourism exhibition in Bulgaria - Holiday & Spa Expo. “The biggest problem for the businesses operating in the sector is the requirement for a 30% average annual occupancy rate. The usual occupancy rate for guesthouses is about 15-20% which means that they will have to pay extra. And tour operators will be forced to close their country tourism programmes,” he said. Popyordanov asked for a “tax holiday” for this sector and the introduction of registration for seasonal houses and hotels that should not have to pay year-round tourist tax.

“Now, the establishments will be charged a tax even when they have no guests. This will be a second tax in addition to the corporate income tax,” George Pamporov from the Rhodopes regional tourism association commented for Klassa. “Guesthouses are mostly visited on holidays and weekends, and we must reach a 100% occupancy rate in four months,” he explained. “Thus, guesthouses will have to pay an annual tax of BGN 400-600 on a turnover of some BGN 4,000-6,000 a year,” Pamporov added.

Vitan Ivanov, head of the Sofia tourist region, expressed dissatisfaction that, without consulting with businesses, the Sofia Municipality had voted the maximum size of the tax for five-star hotels – BGN 3.

According to Deputy Minister of Economy Ivo Marinov, local authorities will be obliged to use the funds for the development of tourism in their region and this will be stipulated in the new Tourism Act. Marinov added that Bulgaria’s new website for tourism, worth almost BGN 2 mln, should be ready by June.

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