Tax regulation mechanism
Updated: 23.01.2019
The use of renewable energy technologies in buildings is promoted through a system of tax incentives for building owners. The incentive scheme provides that a building that has been granted a class A or B energy performance certificate can be exempted from property tax for a longer period of time if renewable energy technologies are used in the building.
Buildings put into service before 1 January 2005 and certified with energy consumption class “B” and the buildings put into service before 1 January 1990 which have been granted certificates of energy consumption class “C” are exempted from tax for a period of (art. 24 par. 1 no. 18 Local Tax Act):
- 7 years from the year following the year of issue of the certificate;
- 10 years from the year following the year of issue of the certificate if there are implemented recovery measures using RES in order to meet the needs of the building.
Buildings put into service after 1 January 1990 and before 1 January 2005 and certified with energy consumption class “C” and buildings put into service before 1 January 1990 and certified with energy consumption class “D” are exempted from tax for a period of (art. 24 par. 1 no. 19 Local Tax Act):
- 3 years from the year following the year of issue of the certificate;
- 5 years from the year following the year of issue of the certificate if there are implemented recovery measures using RES in order to meet the needs of the building.
The tax exemption under art. 24 par. 1 no. 18 and art. 24 par. 1 no. 19 shall not apply in cases where a building has been granted a class A or B energy performance certificate thanks to energy efficiency measures funded through public funds (art. 24 par. 1 no. 7 Local Tax Act). The certificates for energy efficient buildings are based on an ordinance issued by the Bulgarian Ministry of Energy. According to art. 11 of Ordinance No. RD-16-1057, energy performance certificates contain information about:
- the type of building, year of commissioning, total area, heated area
- values of integrated energy performance regarding energy consumption, specific energy consumption for heating, ventilation and hot water for domestic purposes
Bulgaria