Do you owe property taxes in Bulgaria?

The Constitutional Court will decide whether the owners of property which can't use due to various restrictions, will pay local taxes for them.

According to the Supreme Court of Administration there is discrepancy between the law for local taxes and fees and the Constitution, which is why the administrative judges have expressed doubts, that the owners which can not use their properties owe property taxes.

The case has occurred when the Supreme Court of Administration has received a complaint from a company against the judgment of the Administrative court - Sofia - city in a case brought by Sofia Municipality against the company.

The court has rejected the appeal of the company against an act for the establishment of an obligation issued by the Department of local taxes and fees.

In 2008 the company has acquired properties in Krasna Polqna district of Sofia Municipality, which were scheduled for construction. According to the new city plan, the land is provided for landscaping and gardens, but however the municipality has not carried out the expropriation procedures.

The Municipality sues the company for unpaid taxes, as the Court has accepted that, despite the change in the intended use of the property in accordance with the general development plan, taxes are owed, as the land is within the boundaries of the settlement, and that the act against the company is legitimate.

The case raises the question whether the modified development status of the property corresponds of the notion of "property" in the context of the guaranteed right to peaceful use of the property, for which the country is entitled to impose tax.