site.btaBulgarian Economy Gradually Comes to Light - Analysis

114 ECONOMY - COMING TO LIGHT

Bulgarian Economy Gradually Comes to Light,
Industrial Capital Association,
National Centre Report


July 1 (BTA) - The Bulgarian economy is gradually coming to light, Prof. Dr Stefan Petranov said here on Monday. Petranov, who heads the team that developed the Business to the Rules Composite Index, presented an analysis of the situation and tendencies of rolling back the informal economy at a news conference organized by the Bulgarian Industrial Capital Association (BICA) and the National Centre Business to the Rules.

In 2018, the Composite Index rose by 4.55 points to a record 74.55 points, compared to 71.81 points in 2016. Petranov specified that these are preliminary figures and the indicators are indirect.

An increasing number of people work under contract, the professor pointed out. Although wage payment by bank transfer is steadily increasing, a large part of factory and office workers still get paid in cash, no questions asked.

The level of youth unemployment remained relatively high in 2018, the analysis found.

The VAT compliance rate is improving. The BICA attributes this to a series of actions taken by the Finance Ministry, the Government and the National Assembly to improve and streamline the value added tax rules. Payment of excise duty on tobacco products and alcohol is also increasing.

Despite the good results, the share of the informal economy remains relatively high, Petranov added. The shortage of skilled labour has a negative impact. Key sectors, like healthcare, energy, protection of competition, home affairs and security, remain unreformed. According to the BICA, the latest steep increase of the minimum wage by administrative order has forced certain sectors to adopt further "grey" practices. IG/LG
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