Romania - possible destination for the Bulgarian insurers, if the authorities change the tax system
The possible amendment of taxes for the income of the Bulgarian insurers can generate a transfer of capital to other countries, including Romania, have stated the representatives of Bulgarian profile companies.
This statement came following the Bulgarian Government's proposal to change the tax system for insurance companies, taxes being made based on income and not on the registered profit. Thus, if the change affects only the insurers and not the reinsurers, they will give up to reinsurance 80% or even 100% of the cashed premiums. Moreover, the money invested on the Bulgarian capital market or in bonds could be withdrawn and redirected to other countries.
Currently, the reserves of insurance companies in Bulgaria amount to EUR 770 million, and market specialists say that one third of them could head to the economies of other countries.
Taxes from the insurance market amount at this time to over EUR 100 million, plus the mediations of brokers, of EUR 257 million, which are also taxable.
Author: Mihai CRACEA
on 07.04.2010
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