"The analysis of revenues and expenses for the next calendar year showed a "hole" in the budget of 18 billion. leva. The difference between revenues and expenses is estimated based on current legislation, current policies and the macroeconomic forecast for 2025. The measures we will propose are for 12 billion. BGN, so that the deficit comes within 3% or 6 billion. BGN," Deputy Prime Minister and Minister of Finance Lyudmila Petkova said during a briefing in the Council of Ministers.
Petkova recalled that for about a month - a month and a half, she has been holding meetings in connection with the planned measures both with the employer and trade union organizations, with the National Association of Municipalities in the Republic of Bulgaria, and with the political parties represented in the parliament in the 51st National Assembly. As a result of these meetings, some of the revenue measures will not be introduced, for example, the measure to increase insurance will not be proposed. What will be proposed as revenue measures, Petkova explained, are taxation of excess bank profits, a tax on underground wealth, two tax amnesties - one related to declaration of late taxes and insurances, the other related to undeclared income.
An increase in excise duties on tobacco, tobacco products and alcoholic beverages is foreseen, as well as some proposals related to the elimination of reduced VAT rates. "It is leading for us that there should be no increase in the main taxes - VAT, corporate tax, on the income of individuals, as well as insurance, as they have a direct impact either on inflation or on economic development. That's why we propose these measures that have the least negative effect on the country's economy," the finance minister explained the philosophy behind the proposals.
In terms of spending, salary increases for police, military and teachers in 2025 will be provided in the amount and in the manner voted into law by the National Assembly, the Deputy Prime Minister promised. She explained that a new income policy in the amount of a 10% increase is also planned, as well as an update of pensions under the Swiss Rule.
The Ministry of Finance has made a comprehensive analysis of the projects under the capital program so that funds can be secured from the 2025 budget for that part of the projects that have started and will not be completed in 2024. The capital program will include, in addition to the funds needed to complete the projects from 2024, new projects as well, explained the finance minister. The capital program will be structured along three main directions. The first is related to administrative capital costs, for example for current repairs and for activities that are necessary and without which the relevant institution cannot function.
The second direction is related to IT systems, since the overall digitalization is necessary for both the administration and the economy. And the third direction will be spending on national strategic projects.
Lyudmila Petkova explained that the draft Law on the State Budget for 2025 will be discussed in the National Council for tripartite cooperation with social partners and will accordingly be adopted by the Council of Ministers and submitted to the National Assembly next week.
"To the draft law, in the transitional and final provisions, all proposals for changes in the relevant laws will be included, in relation to which they refer to the revenue and expenditure measures respectively. Proposals in connection with the project to create a Unified Revenue Agency will also be included there," said Petkova.