site.btaMedia Review: September 29

OVERVIEW

On Tuesday, Bulgarian media focus on proposed tax changes, the new minimum wage mechanism and the finance and economy measures of the government in general.

ECONOMY

In an interview for Bulgarian National Television’s morning programme Labour and Social Policy Minister Nataliya Efremova said that the new support mechanism for Christmas and Easter expands the pool of people eligible for additional aid, allowing vulnerable families and low-income individuals to receive an extra EUR 50, not just pensioners. The government is considering a Social Protection Code to consolidate more than 56 social measures currently spread across eight or more laws, making support easier for people to understand and access. “Ultimately, it should be oriented towards the individual's needs, ensuring that people do not have to adapt to a fragmented legal landscape, but can instead find specific information in one place about the support available for the various vulnerable situations they may face,” Efremova said. She addressed the issue of support regarding high fuel prices, saying that payments for the newly developed "inflation check" for vulnerable families would begin on October 1. Recipients can decide how to spend it, she added. "In other words, we are broadening the scope of support, compared to the version introduced in the spring, to include a wider range of people, allowing them to make their own choices, whether to use the funds for fuel or for other goods and services." The Minister said EUR 300 million in additional support is planned for families in the 2027 budget: EUR 100 million for family benefits and EUR 200 million for tax relief. Labour-market priorities include training and retraining workers, addressing the impact of AI, and encouraging Bulgarians working abroad to return. The “I Choose Bulgaria” programme has reportedly brought back around 2,000 people. The Minister also supports the new minimum wage mechanism agreed between employers and trade unions. She said that increasing social-security contributions is not currently being considered.

***

Bulgaria made substantial progress in raising minimum wages and low-paid workers have gained purchasing power, Dnevnik.bg writes in an article, but the country still has the lowest minimum wage in the EU, and inflation, weak collective bargaining, and low overall wage levels remain major challenges. In 2026, the gross minimum wage is about EUR 620, with around 19% of Bulgarian workers earning the legal minimum. Over the past decade, Bulgaria’s minimum wage has increased by about 189%, one of the largest increases in Europe, but it still remains the EU’s lowest. The EU’s new minimum-wage directive encourages adequate wages and collective bargaining. Bulgaria has implemented only part of it so far. Experts argue that higher wages are important for retaining skilled workers, while policymakers also need to balance workers’ needs with businesses’ ability to pay. Ivaylo Kalfin, Executive Director of Eurobond, the European Foundation for the Improvement of Living and Working Conditions, told Dnevnik that the renegotiation of the minimum wage formula undertaken by Rumen Radev's government represents "the successful conclusion of years of effort, driven by the pressure of European legislation adopted three years ago." "The government evidently scrapped the previous formula to compel social partners to sit down at the negotiating table and find a solution for a new one. That is exactly what happened, and the best aspect of the new formula is that it enjoys the support of both trade unions and employers," Kalfin said. In his view, "Bulgaria must strive to accelerate income growth, including the minimum wage, if we want to prevent skilled workers and professionals in high-demand fields from leaving. Relying on migrants is not a better solution than retaining our own workforce." Kalfin added that concluding the current negotiations does not mark the end of Sofia's obligations, noting that "there is still much work to be done: the National Statistical Institute must demonstrate its ability to measure the income required for a minimum standard of living; trade unions and employers need to extend collective bargaining agreements to more sectors; and regional specificities must also be taken into account." "As a point of some reassurance, we can say that although Bulgaria’s gross wage is the lowest in the EU, and by a wide margin, the situation looks better when comparing net incomes," Kalfin told Dnevnik. The article says that collective bargaining is particularly effective in some sectors, such as arts and theatre, where negotiated wages have risen substantially. And adds that recent increases in fuel and other prices could reduce some of the gains in purchasing power.

***

In an interview for Bulgarian National Radio, economist Assoc. Prof. Shteryo Nozharov, a lecturer at the University of National and World Economy (UNWE), said that substantial structural reforms need to be initiated. “The current authorities are hesitant to undertake them. However, given the excessive deficit procedure, if these reforms are not implemented now, Bulgaria risks heading toward the Romanian scenario." "I see an attempt to bring economic activity out of the shadows, but it is targeting an area that is not the core problem of the grey economy. There is no clear plan evident in the actions of the Finance Ministry. We do not see a strategic, long-term approach to balancing the budget with regard to the structural deficit on an accrual basis, a metric monitored by European institutions. There is a visible desire to act, but it is coupled with chaotic execution. On August 24, the Finance Ministry issued budget guidelines to primary budget spending units aimed at curbing public expenditure, yet we have not seen any significant cooling off. Tax relief for families with children will cost 300 million, while pension adjustments amount to 450 million." The economist further explained that the hike in the minimum wage would also lead to higher remuneration for at least 500,000 public sector employees. The net effect of all this amounts to 130 million against a budget deficit of 7.3 billion, he summarized. Nozharov does not expect the "excess profit" tax to reduce the budget deficit on an accrual basis. "The cost will be passed on to consumers. None of the institutions regulating these sectors has the authority to impose price caps. Such a measure should primarily aim to reduce the budget deficit, yet it fails to lower it by even a single euro." The Bulgarian National Bank (BNB) warned that the idea of ​​imposing an "excess profit" tax on banks could lead to more expensive or less accessible loans for households. However, Deputy Prime Minister and Finance Minister Galab Donev stated that BNB Governor Dimitar Radev was making insinuations and interfering in the political situation; Donev defended the proposal to tax excess profits in certain sectors, including banking. Nozharov believes the Governor's statement aligns with the European Central Bank's position, which opposes the imposition of extraordinary taxes by member states in the realm of public finance.

***

Modern Trade Association Executive Director Nikolay Valkanov talked to Nova TVs morning programme about the government's plans to introduce a windfall tax on large retail chains. Valkanov insisted that the proposed tax is in fact a windfall tax and not an "excess profit" tax, as the government calls it. “Profit is measured as a percentage of revenue, and profit margins in food retail are declining,” he said, adding that plans are made to impose an extraordinary burden on the compliant taxpayer.

In a different format on Nova TVs morning programme, economist Georgi Vuldzhev also expressed reservations regarding the proposed excess profit tax. According to him, the banking sector is the only one among those selected for which there might be a substantial justification. "As for the other sectors, it is quite unclear to me on what basis they were selected," he said. According to financier Nikola Filipov, those in power face the difficult task of balancing the budget. “They are trying to balance it, but too quickly, which does not always yield positive results. We must be extremely cautious when it comes to regulating the financial and banking sectors. Banks collect deposits that they lend to businesses and individuals. Insurers collect premiums used to pay out claims. When we levy taxes on these sectors, even if only as a one-off measure, we aren't really hitting the insurers themselves; we are hitting the depositors and the policyholders," the financier said. "They reduce liquidity. Instead of these funds going to policyholders, they go to the state. This increases systemic risk in both the banking and insurance sectors. Theoretically speaking, when you take financial resources that belonged to policyholders and transfer them to the state, you effectively have fewer resources available for payouts," Filipov said. Former deputy prime minister, economy minister and labour and social policy minister Lidia Shuleva highlighted the need for serious reforms in the public sector. "This conversation began earlier this year with the budget but led nowhere. Recent data show that public sector wages are higher than those in the private sector. This is an abnormal economic situation. Public sector reforms, specifically addressing the vast number of inefficient and overlapping structures, represent a major issue," she warned.

***

Trud’s front page article reports that the Finance Ministry is proposing large increases in property tax over the next three years, by raising the property tax valuations by 30% in 2027, 27% in 2028, and 21.5% in 2029, effectively doubling property valuations. The waste collection fee would not automatically increase under these changes, although municipalities could change it separately. Municipal councils set the actual property-tax rate, so the final increase could vary between municipalities, the article explains. The 5% discount would be available for paying the full annual property tax in advance, with the deadline extended to the end of May in 2027. Proposed fines under the local-tax law would largely keep their current nominal levels but be converted from lev to euro. Previous governments have attempted to increase property valuations before, but previous proposals were not approved by parliament, the article says.

***

Homemade rakia (brandy) is more controlled than drugs and weapons, Telegraph Daily’s front page article says. Instead of scraping the excise duty on this type of alcohol completely, as in many parts of Europe, more restrictions are being put in place, Petko Sabev, head of the Bulgarian Homemade Brandy civil association, told Telegraph. He was asked to comment on the government's intention to further tighten control over this type of alcohol. The Finance Ministry proposes to prohibit the possession of domestic brandy, not produced by the person who stores it, with amendments to the Excise Duties and Tax Warehouses Act. The fine for violators will be at least EUR 1,000. The idea of ​​this measure is to limit the trade in homemade brandy, which by law has a halved excise duty and is only for personal consumption. The proposed changes caused controversy and ridicule on social networks, especially from representatives of the opposition in parliament. Because the proposed text states that if you keep a bottle of homemade brandy, a gift from a friend or neighbor, in your refrigerator, you can be fined by the Customs Agency. All over Europe, the excise duty on alcohol for personal use was abolished, Sabev said. In addition, in a number of countries, small producers are allowed to make alcohol and sell it at a reduced rate. This applies to up to 2,500 litres of 40-degree drink per year. "Thus, thousands of families will be given the opportunity to legally produce and sell homemade rakia and pay their taxes to the state," Sabev said.

PRESIDENTIAL ELECTION CAMPAIGN

Duma.bg reports on presidential candidate Iliana Iotova’s campaign meeting in Razgrad. Iotova’s presidential candidacy was made by a nomination committee and backed by the Bulgarian Socialist Party and ruling Progressive Bulgaria. “When it comes to Bulgaria’s future, all institutions must work in cooperation, each within its own mandate, alongside the strength and energy of every Bulgarian citizen.” "I am a person who seeks consensus. I deeply believe that when the national interest is at stake, people with differing convictions can sit at the same table and make the right decisions," Iotova emphasized. She noted that in the absence of division and unnecessary confrontation, there is no room for the formation of shady alliances designed to weave corruption schemes or award public contracts solely to "our own people”.

***

In an interview for bTVs morning programme, Andrey Gurov said that he expects to receive support from GERB voters as well in the upcoming presidential election, even though the party has officially declared that it will not back a candidate and will not offer unsolicited support. Gurov’s presidential candidacy was made by a nomination committee and backed by Continue the Change and Democratic Bulgaria. "Our civic initiative committee has not formally sought support from any political group. We are appealing to voters and citizens based on the principles and ideas we propose for Bulgaria's development," Gurov said. He emphasized that the president must be the head of state for all Bulgarians, regardless of their political preferences or place of residence. He identified incumbent President Iliana Iotova as his main opponent, citing her institutional position as one of the reasons for this. Gurov stated that his candidacy aims to offer a different model for the presidency, one characterized by greater independence and closer contact with citizens. He also commented on his relationship with Iotova from the time he served as caretaker prime minister. According to him, there was "very good" cooperation between the institutions, and no problems or conflicts arose.

JUSTICE

Segabg.com reports that Bulgaria’s Supreme Court has definitively ordered the prosecution service to pay EUR 64,000 (BGN 125,000) in compensation to the widow and daughter of businessman Alexey Petrov, who was killed in 2023. The compensation covers non-material damages and legal-defense expenses resulting from an unlawful criminal prosecution against Petrov. The court increased the non-material damages to BGN 20,000 for each woman, saying that the prosecution damaged Petrov’s personal and professional reputation. The prosecution must also pay interest dating back to February 2020, which brings the total interest to about BGN 49,500. Petrov originally sought BGN 200,000 over charges of embezzlement and money laundering, for which he was ultimately acquitted. Sega adds that the investigation into Petrov’s 2023 murder appears to have made little progress: three years after his killing, there is reportedly still no publicly identified suspect.

EDUCATION

24 Chasa daily examines social media, changing generations, and the challenges facing education, in an interview with business consultant Lyubomir Getov, who argues that banning social media for children under 15 would be difficult to enforce and could encourage children to bypass restrictions rather than solve the underlying problems. Generation Z and Generation Alpha have grown up with the internet and social media as a normal part of life. Getov says technology is not inherently negative and can provide important access to information and education. Constant exposure to information may be changing how young people learn, concentrate, and remember things. They tend to value practical knowledge and often question why they need to learn information that they may not use. He argues that education needs major reform, particularly in Bulgaria, where traditional systems based on memorization and passive learning are poorly suited to today's environment. Digital distraction is a problem for both young people and adults, but he says interesting, relevant teaching can still hold young people's attention for long periods. Traditional authority is also changing: young people increasingly expect partnership, practical value, and leaders who earn their respect, rather than simply accepting authority based on position or age. Getov argues that instead of trying to force young people back into older patterns through bans and stricter discipline, schools and institutions should adapt their teaching, leadership, and communication to the realities of a digital, information-heavy world.

CULTURE

In an extensive article Mediapool.bg explores the decline in reading in Europe alongside the renewed popularity of book and writing clubs. Only about 30% of Europeans read at least five books a year, while in Bulgaria nearly half the population reportedly reads no books annually. Despite this, reading clubs are thriving, both in person and online, with groups forming around particular genres, communities, or interests. Bulgaria has numerous clubs in Sofia, Varna, Vidin, and smaller towns, hosted in libraries, bookstores, cafés, cultural centers, and parks. Writing clubs are also growing, giving people a space to create, share their work, and build social connections. One Sofia writing club, for example, has produced more than 2,000 pieces of writing. The article emphasizes that these clubs are not only about literature: they help build community, encourage creativity, and reduce social isolation. “At the club we no longer get together just to write. Once a month, we attend a cultural event together, we also meet up at a bar or restaurant. Our members span a wide range of ages and professions - business analysts, lawyers, psychologists. People with diverse sexual orientations and viewpoints join us. It’s a truly eclectic mix. The great thing about the community is that everyone is welcome and decides for themselves whether they fit in," poet Lyubomira Videva told Mediapool.