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Croatian President Ivo Josipovic (C), Prime Minister Zoran Milanovic (L) and the Parliament speaker Boris Sprem (R) make a toast upon hearing unofficial results of the referendum, at the Croatian Parliament in Zagreb, 22 January 2012. EPA/BGNES
Croatia and Cyprus are about to increase their value added tax as the beginning of next month in a bid to cope with the crisis and rake in more revenues in the budget.
The planned value added tax hike in Croatia will push it from 23 to 25% and make it one of the countries in Europe with the highest VAT rate, alongside Denmark, Sweden and Norway.
In Croatia, VAT was imposed on 1 January 1998 at the rate of 22%. It was increased by one per cent on 1 August 2009.
In Cyprus the value-added-tax will increase from 15% to 17% on March 1. Thus, the government hopes to reduce the projected budget deficit to 2.4% of gross domestic product (GDP) in 2012 from 6% last year.
The European Commission warned Cyprus that it faces the threat of financial penalties if it does not reduce the deficit to below 3% of GDP.
Hungary has the highest VAT rate in Europe at 27%. The lowest VAT rate in the European Union - 15% - is in force in Luxembourg.
After a series of U-turns Bulgaria's government decided at the end of May 2010 to scrap plans for an increase of the 20% value added tax in a bid to plug a budget gap that has thwarted the new EU member's efforts to join the euro in the near future.
The VAT increase has been a thorny issue in Bulgaria for months on end with the cabinet changing their mind numerous times and several versions tossed around, ranging from 22% to 24%.
The VAT hike was proposed as part of a package of new austerity measures, which also include the introduction of a luxury tax, floating minority stakes in state-owned companies and a possible bond issue.
Politicians, analysts and trade unions took a firm stand against the hike, citing a long line of negative repercussions – an increase in the inflation rate, an expansion of the grey sector, a slow-down in the economic growth, in short a boost for the impact of the crisis.
Representatives from all business sectors cautioned that the hike in the value-added tax in Bulgaria should be a last-ditch measure, introduced only together with an overhaul in government expenditure and structural reforms.
Bulgaria’s new government borrowing for 2026 has surpassed the 1 billion euro mark following the latest successful auction of state securities, according to data cited from the Bulgarian National Bank
Housing prices in Bulgaria have surged by 157% between 2015 and the end of 2025
Meteorologists from the National Institute of Meteorology and Hydrology (NIMH) at the Bulgarian Academy of Sciences have issued a yellow code warning for strong and potentially hazardous winds across all of Bulgaria on Wednesday.
Bulgaria recorded only a modest and one-off increase in inflation following the adoption of the euro on January 1, with the effect estimated at between 0.3 and 0.4 percentage points
Specialists in the real estate and tourism sectors are forecasting a notable rise in the prices of vacation properties in Bulgaria, with estimates pointing to an increase of between 25% and 30%
The newly appointed Ambassador of the Republic of Azerbaijan to Bulgaria, H.E. Elmar Mammadyarov, has officially begun his diplomatic mission after presenting copies of his credentials to Deputy Foreign Minister Radi Naydenov at the Ministry of Foreign Af
Bulgaria recorded only a modest and one-off increase in inflation following the adoption of the euro on January 1, with the effect estimated at between 0.3 and 0.4 percentage points
Data released by the Ministry of Finance, covering budget execution for February 2026 and preliminary estimates for March 2026, indicate a marked deterioration in Bulgaria’s fiscal position
In the 2026 edition of the Index of Economic Freedom, compiled by the Heritage Foundation, Bulgaria is placed 38th out of 176 countries, positioned between Costa Rica and Oman
Finance officials and the Bulgarian National Bank have issued a series of warnings about Bulgaria’s fiscal and economic outlook for 2026, highlighting rising pressure on public finances, slower growth, and higher inflation.
With the initial months following the introduction of the euro, institutional oversight in Bulgaria is gradually shifting from intensive inspections to a more systematic and long-term monitoring framework
Bulgarian National Bank Governor Dimitar Radev has warned that inflation risks are increasingly driven by geopolitical developments, stressing that Bulgaria remains firmly anchored within the European institutional and political framework
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