Producer of 80% of Sensors in European Cars

Bulgaria Investment Incentives

R&D: There is a reduced corporate taxation (5%) for R&D, IT developments, and high-tech manufacturing, as well as a reduction in social security for the first 3 years of operation. Cash grants are available but limited. The initial investment should subscribe to Priority Class to benefit from tax reductions and cash grants within the R&D sector.

Job creation & CAPEX: Manufacturing and service sectors could benefit from cash grants for job creation. Tax reductions are also available for employers who hire disabled candidates or for manufacturing companies that operate in areas with high unemployment rates.

Training: Bulgaria offers several training-related incentives from training subsidies for industries with labour shortcuts to tax deductions and exemptions for R&D and other industries. Bulgaria receives financial support from the European Union through various structural funds. These funds are available for training initiatives and can provide co-financing for employee training projects undertaken by eligible companies.

Green and other: The country could offer green certificates for renewable energy producers and has established an Energy Efficiency Fund to provide financial support for energy efficiency measures in various sectors, including construction, manufacturing, and production.

Overview: Bulgaria is a low-cost location for foreign investors that can offer several incentives across different sectors to encourage R&D activities, job creation, capital expenditure, training initiatives, green projects, and more developments. Companies usually get taxes around 10% of the net income for the respective year which applied to both resident and non-resident companies derived from their business activities in Bulgaria. Companies investing in Bulgaria are classified into three categories based on the amount of their investment: Priority Class, Class A, and Class B.

Capital:   Sofia
Surface area:  111,000 km²
Population:  6.9 mil
Unemployment:    4.4%
Currency:  Bulgarian lev (=EUR 0.51)
GDP growth: 3.4% 
FDI net inflow (% of GDP) in 2021: 2.5%

Prospective sectors: Manufacturing, IT and BPO, automotive, electronics, life sciences

Worth knowing: Bulgaria is one of the low-cost countries and ranks in the 19th position with the highest GDP within the EU. The country is recognised for producing 80% of the automotive sensors within Europe and holds the third position globally in terms of the number of IT specialists per capita.