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Fri, Feb 10 2012
Pass-the-parcel at Customs
Photo: Цветелина Ангелова
On January 8, Elenko Elenkov published his experience with Bulgarian Customs in Sofia and what he had to go through to collect a couple of t-shirts that he had ordered online from the US for Christmas.
He had to go through 14 different offices, he lost four hours of his time during a working day and paid close to 60 leva including the duties, VAT, levies and a number of other fees, some of which he should not have had to pay, according to the law.
A day and-a-half later, the article Elenkov posted on dnevnik.bg was read by 47 000 people and had drawn more than 600 comments. It went around Facebook and Twitter at the speed of light, and resulted in a boom of stories posted on blogs and online forums by people telling their own horrifying stories.
As of January 1 2010, thousands of other people are subject to the same bureaucratic experience that Elenkov had. Before the end of 2009, people who ordered items online from outside the European Union had to take the same 14-offices route only if the cost of their purchase was more than 150 euro.
This means that everything that cost less than 150 euro could have been collected without paying a visit to Customs. Because of an amendment to the VAT Act, however, inspired by EU legislation, consumers now have to go to Customs every time when they have purchased something that costs more than 15 euro (postage and packaging not included), and pay the relevant duty, VAT and customs fees.
Why?
The amendment to the VAT act was introduced between the first and second reading of the act by Menda Stoyanova, an MP for ruling party GERB and chairperson of Parliament’s budget committee.
The amendment was introduced when the draft bill was still being discussed by the committee. It was approved by the committee without any remarks or concerns and without any explanation why it was introduced, according to Parliament’s records. The text reads: "Are there any concerns about this text? No!"
When Stoyanova was approached for comment after Elenkov posted his story, she first asked for some time to recall the case of the amendment. Later, she said that the change (lowering the threshold from 150 euro to just 15 euro) was imposed as part of Bulgaria’s process of harmonising its legislation with the EU as stipulated in several EU directives. The Finance Ministry had the same explanation.
According to EU legislation, as of December 1 2008, the maximum allowance for the duty-free import of small consignments was increased to 150 euro per consignment while for the VAT on imports, the existing value limit of 22 euro remained in force. And since the latter rate for Bulgaria was 150 euro, it had to be reduced to less than 22 euro. In other words, Bulgaria, like other EU states, had the choice of picking a rate of up to a maximum of 22 euro . Bulgaria chose a 15 euro rate. According to Stoyanova, if Bulgaria had not changed its rate, the country would have faced sanctions and penalties (the European Commission even sent a warning letter on the issue to the country).
As for why Bulgaria chose the 15 euro rate, and not the maximum 22 euro rate, Stoyanova’s explanation was not very persuasive. She said that this was because when it comes to the term "minor value", the widespread notion in Bulgarian legislation understood the rate of 30 leva or 15 euro. That way she said both terms, the Bulgarian and the EU one, would be equalised. This, however, could still have happened if Bulgaria had chosen the 22 euro rate or 44 leva. The difference of seven euro could be equivalent to the cost of an additional book ordered online, and for the purchase of which now people have to go to Customs and undergo Elenkov’s experience.
He had to go through 14 different offices, he lost four hours of his time during a working day and paid close to 60 leva including the duties, VAT, levies and a number of other fees, some of which he should not have had to pay, according to the law.
A day and-a-half later, the article Elenkov posted on dnevnik.bg was read by 47 000 people and had drawn more than 600 comments. It went around Facebook and Twitter at the speed of light, and resulted in a boom of stories posted on blogs and online forums by people telling their own horrifying stories.
As of January 1 2010, thousands of other people are subject to the same bureaucratic experience that Elenkov had. Before the end of 2009, people who ordered items online from outside the European Union had to take the same 14-offices route only if the cost of their purchase was more than 150 euro.
This means that everything that cost less than 150 euro could have been collected without paying a visit to Customs. Because of an amendment to the VAT Act, however, inspired by EU legislation, consumers now have to go to Customs every time when they have purchased something that costs more than 15 euro (postage and packaging not included), and pay the relevant duty, VAT and customs fees.
Why?
The amendment to the VAT act was introduced between the first and second reading of the act by Menda Stoyanova, an MP for ruling party GERB and chairperson of Parliament’s budget committee.
The amendment was introduced when the draft bill was still being discussed by the committee. It was approved by the committee without any remarks or concerns and without any explanation why it was introduced, according to Parliament’s records. The text reads: "Are there any concerns about this text? No!"
When Stoyanova was approached for comment after Elenkov posted his story, she first asked for some time to recall the case of the amendment. Later, she said that the change (lowering the threshold from 150 euro to just 15 euro) was imposed as part of Bulgaria’s process of harmonising its legislation with the EU as stipulated in several EU directives. The Finance Ministry had the same explanation.
According to EU legislation, as of December 1 2008, the maximum allowance for the duty-free import of small consignments was increased to 150 euro per consignment while for the VAT on imports, the existing value limit of 22 euro remained in force. And since the latter rate for Bulgaria was 150 euro, it had to be reduced to less than 22 euro. In other words, Bulgaria, like other EU states, had the choice of picking a rate of up to a maximum of 22 euro . Bulgaria chose a 15 euro rate. According to Stoyanova, if Bulgaria had not changed its rate, the country would have faced sanctions and penalties (the European Commission even sent a warning letter on the issue to the country).
As for why Bulgaria chose the 15 euro rate, and not the maximum 22 euro rate, Stoyanova’s explanation was not very persuasive. She said that this was because when it comes to the term "minor value", the widespread notion in Bulgarian legislation understood the rate of 30 leva or 15 euro. That way she said both terms, the Bulgarian and the EU one, would be equalised. This, however, could still have happened if Bulgaria had chosen the 22 euro rate or 44 leva. The difference of seven euro could be equivalent to the cost of an additional book ordered online, and for the purchase of which now people have to go to Customs and undergo Elenkov’s experience.
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The underlying issue is that Bulgaria will remain a poor country because of this type of administrative nightmare. Nobody will want to do business or live here because it's too complicated.
We had a similar issue at KAT (car registration) where incompetence breeds corruption.
Civil servants act like they're doing you a favour. Whilst police officers deliver the relevant papers to "business men" at the cafeteria outside to speed up their application process.
And everytime you pay a bribe however small you feed the system.
[...]
Read the full comment /> Ironically, I am sure that drug and arms dealers don't face the same bureaucratic constraints.
Bulgaria needs to develop a civil service ethos, serving the State and the people.
SADLY..BEEN THERE, SEEN IT, DONE IT :-(
Lets be honest, 99.9% of the staff in the customs offices are just not interested and if there's a way for them to receive an easy cash back-hand payment then the whole world knows the Bulgarians will do it. Unfortunately it's just typical of so many other govt' depts that run along the same lines..you know thats true! The sad part is that by being so underhand, greedy, ill trained and to have & show no interest in helping people by doing their job properly... one day it will come [...]
Read the full comment back and bite them in the backside...COME ON WAKE UP BULGARIA...CATCH UP WITH THE REST OF THE WORLD..OTHERWISE YOU WILL GET LEFT BEHIND...people are getting sick of being 'ripped off' by the officials & anyone in a uniform..being renown world wide for being incapable of organising a postal system & government depts that seems to be forever on the take is not something to be proud of (if you ever pay a bribe your not helping anyone except some lazy, greedy, dishonest, low life to take your hard earned money for themselves)...the normal hardworking law abiding people of this country are better than that & they don't deserve to have the reputation that the rest of the country has, that is caused by 'official' workers being inept, greedy, underhand,dishonest etc. GET YOUR GOVERNMENT BE RESPONCIBLE FOR ITS STAFF AND TO SERVE YOU PROPERLY.
haha, great story/article/idea!
If I were any more vocal, my story would have trumped that.
I didn't pay anything to collect my belongings I shipped from Canada, but I had to lose at least 2 days and had to visit not 14 offices, but 3 distinct addresses.
In the end, they cleared my stuff without any import tax, which is great, but it took long...
And I ripped my brand new pants on their banister.
Dear fellow readers: Of course Customs could simplify the procedures to make them user friendly. But then that would reduce opportunities for Customs employees to demand and collect bribes to "expedite" what should ordinarily be a simple procedure.
It's about time that someone wrote this story, and since we can laugh about it now, really enjoyed reading this article. My husband and I recently endured what can only be described as the 9th circle of h@ll when we imported our personal effects from overseas. We thought it would be relatively easy. After all, I have worked in international logistics for 14 years (several as a customs broker) and my husband is a Bulgarian citizen, we figured between the two of us, it would be no problem. We spent DAYS dealing with the paperwork and what was a minimum [...]
Read the full comment of 6 trips to Customs (to be honest, we lost count we went there so many times). What was probably the worst though was the total lack of knowledge. I cannot tell you how many times we were given completely wrong information from the people that work at Customs. The average citizen should not have to become a customs expert in Bulgaria, Customs officials should be the experts. We tried to look up the relevant laws, but there is also a lot of conflicting information (mostly from the internet, but who knows how often that is updated with new information). I was a bit surprised actually to know that the customs clearance procedure here is still done manually. I was told that BG should be able to do this electronically, perhaps this year. This would be a huge win for Bulgaria. I kept wondering if businesses who are importing have to go through this. If so, I have to imagine how it can really be detrimental to businesses. It sort of became our second job for awhile. Happily, in the end, we did get our stuff.
Why re-invent the wheel. Customs should find out what the procedures are in say Germany and Austria and simply translate to Bulgarian and issue as a directive to all customs offices.
In Bulgaria if there is a easy way or hard way, the hard way will always prevail.