Economy of Sofia

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Economy of Bulgaria

Bulgaria is an open and flexible economy. The economy was restructured substantially and began to grow after competitive tax rates, open trade regime, after the relatively high level of resilience from the financial sector during the 2014 liquidity crisis. Between May 2013 and October 2014 Bulgaria held the European Parliament elections and two national parliamentary elections. A year after the election, protests broke out due to low living standards, corruption, and high energy costs. This caused Present Rosen Plevneliev to dissolve parliament because of the banking instability. Recovery since the crisis has been slow, but increasing steadily.

The level of debt tends to be the lowest in the Balkan region with the budget deficits declining. In order to ensure long-term economic growth, the judicial effectiveness and government integrity must be committed to institutional reforms. Tourism, information technology, agriculture, pharmaceuticals, and textiles are all leading industries in Bulgaria. However, migrant flows are an issue.

Property rights are not well protected in the country and public trust in the judicial system is extremely low amongst citizens, due to corruption within businesses in the past.

The individual income and corporate tax rates are 10% and other taxes included estate tax and value-added tax. The government spending or gross domestic product (GDP) has a total of 37.2% with budget deficits being 2.8% GDP and public debt at 26.9% GDP. Trade is extremely important for Bulgaria's economic success with the value of imports and exports equally 131% of GDP.

The economy grew by over 1% in the year of 2017.

Economy of Sofia

Sofia remains a trading hub within Bulgaria and the Balkan region. Its main products are refined petroleum fuels, iron, copper, gold, electronics, bismuth, coal, vehicle components, weapons, and construction materials.

Sofia is the capital and economic hub of Bulgaria and home to most major Bulgarian and international companies that operate within in the country. The city also hosts the Bulgarian National Bank and the Bulgarian Stock Exchange. In the recent years electronics and electric equipment production has regained higher levels of economic growth. A large number of Western-style outlets began to appear in Sofia, and the city developed as a retail center which helped the economy. Sofia is a major air travel hub as well.

All income earned in Bulgaria, including the city of Sofia, is taxed on a flat rate of 10%. In total the employee pays 12.9% and the employer contributes 17.9%. Corporate income tax is flat rate of 10%. Value-Added Tax applies at a flat rate of 20% on virtually all goods and services. A lower rate of 9% applies on only hotel services.

Update 6/06/2018

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