site.btaFood Donated to Disadvantaged People Could Be VAT Exempt - Finance Minister

Food Donated to Disadvantaged People Could Be VAT Exempt - Finance Minister

Sofia, July 18 (BTA) - Finance Minister Vladislav Goranov Monday said food donated by producers to disadvantaged people could be exempted from VAT provided that a way to prevent abuse is ensured. He met with Ombudsman Maya Manolova and representatives of food producer organizations.

Under the VAT Act scrapped food can be VAT exempt, but donated food is not, said Goranov. In his view a cap on donation could solve the problem.

Manolova noted that she would prepare specific proposals to exempt donated food from VAT. "When there is a good cause, it is backed by many organizations, so this could become a fact in 2017," she said. The volume of food donations is expected to grow from the current 270 to 300 tonnes worth 800,000 to one million leva a year. This will make food donation a regular win-win practice, said the Ombudsman.

Goranov commented that without abuse, the negative effect on the Exchequer would be tolerable. The Food Act should specify who can make donations to prevent hidden commercial activity. "I think there is understanding about the need to minimize the potential risks to the Exchequer," he said.