Bulgarian Nightclubs Caught in Tax Probe

2010-08-16

The owners of Black Sea nightclubs and bars have failed to pay 150,000 euros (300,000 lev) in taxes, according to an investigation by Bulgarian tax officials. Owners of the clubs audited by inspectors over the last two weekends had taken 750,000 euros (1.5 million lev) from clubgoers which they failed to declare to tax inspectors, they said. Krasimir Stefanov, the director of the National Revenue Agency (NRA), said on Monday: “There is a facility on the southern Black Sea coast that has not declared a single lev in profit for July. "Another nightclub owes the government about 50,000 euro (100,000 lev) that it hasn't paid , despite it making about 10,000 eruos (20,000 lev) per night,”The large-scale investigation into hospitality facilities around the coast was launched two weeks ago at the peak of the tourist season, in a bid to clamp down on what is believed to be widespread tax evasion. A risk assessment report done by the NRA showed that almost 90 per cent of nightclubs in the country conceal their profits in order to evade tax, costing the state budget about six million euro (12 million lev) every year. As well as concealing profits, the owners of the bars and nightclubs often hire workers without a contract and declare false, low wages for their employees. With tax revenues in the state budget shrinking due to the current economic recession, the NRA has launched several probes to ensure a better collection. The audits will continue until the end of the month. Earlier this year, the NVA audited the profits of local singers and started checks at big music concerts of world-famous bands such as AC/DC and Metallica.