Tax Compliance of Small Business in Transition Economies: Lessons from Bulgaria

GSU Andrew Young School of Policy Studies International Program Paper No. 05-10

50 Pages Posted: 6 May 2005

See all articles by Konstantin V. Pashev

Konstantin V. Pashev

Governance Monitoring Association ; Center for Public Administration-New Bulgarian University

Date Written: March 2005

Abstract

The paper studies the challenges of raising tax compliance in the small business sector in transition economies, drawing from the experience of Bulgaria. It identifies the elements of tax design and enforcement that discriminate against the small business and drive non-compliance. It argues that these drivers are related mainly to the disproportionate tax burden of compulsory social insurance contributions and income taxation of sole proprietors, as well as to the higher compliance costs faced by the small business in Bulgaria. In this framework it studies Bulgarian experience with two presumptive taxes - the patent tax and the minimum insurance income thresholds - and discusses the opportunities and costs of their optimization.

Keywords: Taxation, Small business, Tax compliance, Economies in Transition

JEL Classification: H25, H26

Suggested Citation

Pashev, Konstantin V., Tax Compliance of Small Business in Transition Economies: Lessons from Bulgaria (March 2005). GSU Andrew Young School of Policy Studies International Program Paper No. 05-10, Available at SSRN: https://ssrn.com/abstract=717041 or http://dx.doi.org/10.2139/ssrn.717041

Konstantin V. Pashev (Contact Author)

Governance Monitoring Association ( email )

29B Vaptsarov Blvd
Sofia, 1407
Bulgaria

Center for Public Administration-New Bulgarian University ( email )

21 Montevideo Str. Room II-211
Sofia, 1618
Bulgaria
+359 2 8110 281 (Phone)
+359 2 8110 381 (Fax)

HOME PAGE: http://www.nbu.bg

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
412
Abstract Views
1,669
rank
84,942
PlumX Metrics