"We have a slowdown in inflationary pressure - 4.5% annual inflation. The main reason is the reduced pressure from fuels. We are at the foot of an upward trend, we will probably see inflation accelerate again," said economist Julian Voinov on the show "The Day ON AIR". The guest pointed out that the main increase in prices is in the services sector, and inflation has been over 40% for the last 5 years.
In Bulgaria, incomes are outpacing inflation, Voinov was categorical in front of Bulgaria ON AIR.
The economist noted that the main part of the inflationary pressure began in 2025 - mostly in connection with the currency revaluation.
Where did the inflation come from
"Bulgaria is the country with the highest share of the shadow economy - 30-35%. A large part of the funds outside the banks, 35 billion euros, poured mainly into the mortgage market and this spread to all sectors of the economy. Food prices are increasing the least, while the increase in service prices is huge, Voinov explained.
Prices in one establishment in leva literally became euros, there were such cases. But this is not true for the entire economy, he gave an example.
Bulgaria is one of the countries with the highest inflation in the EU, but at the same time we have the highest increase in incomes in the entire EU - 68% for the last 5 years, Voinov pointed out and added that this increase is not proportional for everyone.
Who are the biggest losers
The economist pointed out that the biggest losers are people from the lower middle class - between 500 thousand and 1 million people. While the poorest and richest have the highest increasing incomes.
"There is a huge concentration of business in a very small number of people - they receive the lion's share of European funds, they own huge areas, which further complicates agriculture in Bulgaria. These funds can influence the political landscape in the country," Voinov emphasized.
According to him, the government must take measures to reduce the shadow economy and break away from the dependencies between business and the political class.
Budget 2026 and taxes
Voinov is convinced that the budget for 2026 will certainly end with a smaller deficit.
"Bulgaria suffers from serious distortions in terms of taxation. They push people not to insure their real incomes. The pension system in the country is a serious problem. Raising the maximum insurance threshold is extremely unfair. A person who is insured for their entire life on the maximum insurance income has no chance of getting close to the maximum pension," he commented.
According to Voinov, we have a problem with tax collection.
Difficult reforms are being postponed, and huge funds are being allocated to national security indiscriminately, the economist warns.