United States And Bulgaria To Sign Tax Treaty

by Glen Shapiro, LawAndTax-News.com, New York

22 February 2007

It emerged this week that Deputy Secretary of the US Treasury, Robert M. Kimmitt and Bulgarian Finance Minister Plamen Orescharski will on Friday sign an income tax treaty and protocol.

The treaty will strengthen economic relations between the United States and Bulgaria by generally reducing the rates of taxation on cross-border dividend, interest and royalty payments, and by providing for better exchange of information between the two countries, including bank information.

Bulgaria on January 1 acceded to the European Union, a move which has meant changes in many aspects of its relations with third countries, including the United States.

In late January, the Office of the United States Trade Representative (USTR) announced that the status of Bulgaria under the Generalized System of Preferences (GSP), a program designed to promote economic growth in the developing world, had changed.

It explained that:

"As a result of becoming EU member states on January 1, 2007, Bulgaria and Romania are no longer designated as beneficiary developing countries under the US GSP program, effective as of that date."

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