site.btaUPDATED Parliamentary Budget Committee Adopts 2023 Budget at Second Reading; Finance Ministry Does Not Support It in This Form

The  Parliamentary Committee on Budget and Finance in the National Assembly adopted the 2023 State Budget Bill at the second reading at a meeting that lasted more than 10 hours on Monday. Committee Chair Yordan Tsonev from the Movement of Rights and Freedoms (MRF) said that he is not very optimistic about the results. Due to the Committee dropping several proposals related to revenue collection measures, the Ministry of Finance does not support the budget in its current form, stated Finance Minister Assen Vassilev at the end of the Committee's meeting.

The MPs considered 84 proposals that came between the two readings of the bill, some of which were related to a 10% increase in the remuneration of workers in some budget areas. The draft budget provided funds for the implementation of specific policies in the fields of science, education, health care, defence, sports and youth activities, culture and arts, foreign policy and agriculture. The bill will enter into force retroactively from January 1, 2023, with the exception of some paragraphs, the Committee decided.

The proposals of GERB-UDF and MRF were worth a total of BGN 157.2 million. Continue the Change - Democratic Bulgaria (CC-DB)  proposed a BGN 150 million increase in the remuneration of Interior Ministry] personnel, starting from August 1, 2023. Vazrazhdane proposed additional financing in the total amount of BGN 155,381,600.

The Committee agreed that the amount of the state subsidy for political parties for one actual vote received should be BGN 8, as proposed by the Council of Ministers. The proposal of the There Is Such a People (TISP) party that the subsidy be in the amount of BGN 1 was rejected.

The total annual quota for providing food vouchers under the Corporate Income Tax Act was agreed to be BGN 1.4 billion.

A proposal to set the total amount of the amount subject to reimbursement to farmers from the diesel excise tax according to the Agricultural Producers Support Act was also accepted.

The Committee supported a proposal that the minimum wage for the lowest government position be BGN 780, as well as proposals for BGN 200 in monthly allowances for raising a child up to one year of age, a BGN 300 one-time allowance for students for the 2023/2024 academic year, and a BGN 300 one-time allowance for students enrolled in the eighth grade.

The Committee decided that the the minimum fiscal reserve as of December 31, 2023 be BGN 4.5 billion, the maximum amount of the state debt at the end of 2023 cannot exceed BGN 40.6 billion, and the maximum amount of the new state debt that can be accumulated during the year in accordance with the Government Debt Act, would be BGN 7.5 billion.

The Committee voted to drop a paragraph, according to which electricity producers with facilities with an installed capacity of more than 1 MW, who received income from the sale of electricity, make targeted contributions to the Power System Security Fund.

Finance Minister  Vassilev stated that in the event that this paragraph is rejected in the plenary hall vote, he will appeal to the National Assembly with a request to cancel the decision of December 9, 2022 to reduce the price of fuel for Bulgarian companies, as there will be no source of funds.

A text which dealt with the Limitation of Cash Payments Act, saw a heated discussion at the meeting as several motions were tabled. In the end, of all the proposals, only CC-DB's proposal passed, which focused on raising the threshold at which dividends must be paid by bank transfer from BGN 500 to BGN 1,000.

The Committee did not accept a proposal that allows customers not to pay if they did not receive a receipt in retail or catering establishments,  as well as for the cash balance to be declared when it exceeds a threshold of 10,000 BGN. The Finance Minister commented that in this way a tool for tax control and collection is taken away.
A proposal to remove the current reduced VAT rates, which could generate revenues in the amount of BGN 152.4 million by the end of 2023, was not accepted. These revenues could have increased in the salaries of Emergency Assistance, Bulgarian Food Safety Agency, Executive Forests Agency, the Hail Suppression Agency, Executive Agency for Fisheries and Aquaculture and Agricultural, commented TISP's Toshko Yordanov.

A proposal by Vazrazhdane to increase the budget for national tourist advertising by another BGN 15 million over the current nearly BGN 19 million  was also not supported.

The Budget Committee did not accept either of the two proposals related to the abolition of the derogation for Russian oil for Bulgaria. The CC-DB proposal stipulated that within 30 days from the promulgation of the law in the State Gazette the Council of Ministers would take action to analyze the risks in connection with the early cancellation of the derogation, and the GERB proposal stipulated that this should be done within 7 days.

The state budget for 2023, as well as the  National Health Insurance Fund and Public Social Insurance budgets, will be debated at the second reading in Parliament on Wednesday, according to the national Assembly agenda.