The Bulgarian cabinet will lower the Value Added Tax, VAT, with 1% by 2013, and will introduce tax police.

The information was reported by the Bulgarian Standard daily, citing Deputy Prime Minister and Finance Minister, Simeon Djankov.

Djankov says it would be rather impossible to bring VAT down to 18%, but a smaller step was "very likely." According to him, the cabinet will implement such step without any warning in order to avoid a shrinking demand over expectations for lower VAT.

The Minister first launched the idea in November, saying the move is planned for 2012. In 2010, he stated that by the end of the term in office of the ruling, center-right Citizens for European Development in Bulgaria party, GERB, VAT will go down to 16%.

On the other hand side, the tax police will monitor and investigate VAT fraud and tax evasion. It will give investigators from the National Revenue Agency, NRA, the right to do their own probes, collect evidence and even make arrests.

The idea had been launched by prior governments, but met the opposition of law enforcement authorities.

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