Bulgaria vs Romania Tax Comparison 2026

Bulgaria and Romania both tax personal income at a flat 10% — the lowest headline rates in the European Union — so choosing between them comes down to everything around that number. Bulgaria extends the 10% to corporate profits as well, the EU's lowest corporate rate alongside Hungary. Romania charges 16% corporate tax, but counters with its microenterprise regime: companies with revenue under EUR 500,000 can pay just 1% of turnover (3% without employees), which for service businesses with healthy margins is generally one of the best small-company deals in Europe.

Social contributions are where the twins diverge most. Romania loads the employee: 35% of gross salary (25% pension plus 10% health), with employers adding only 2.25%. Bulgaria splits more evenly — 13.78% employee and 18.92% employer. A salaried professional comparing net pay on the same gross will generally fare better in Bulgaria; a business owner paying themselves through a Romanian microenterprise structure may reach a very low total burden despite the contribution rates. Self-employed rates are 26.8% in Bulgaria and 25% in Romania.

Capital gains are taxed at 10% in both countries, with one notable Bulgarian sweetener: gains on shares traded on EU/EEA regulated markets are exempt. VAT is 20% in Bulgaria and 19% in Romania, each with reduced rates for hospitality and essentials. Romania offers a digital nomad visa (income of at least three times the Romanian average gross salary); Bulgaria has no dedicated nomad visa as of 2026, so non-EU remote workers typically need other residence grounds.

Costs of living are among Europe's lowest in both (indexes of 34 and 36), with growing tech scenes in Sofia, Bucharest, and Cluj. As a general guide: employees and stock-market investors lean Bulgaria; freelancers and agency owners who can operate through a microenterprise lean Romania; and EU citizens — who can settle in either freely — often simply pick the city they prefer, since at these rates the tax difference rarely outweighs lifestyle fit. Treaty networks are solid for the region (68 for Bulgaria, 86 for Romania).