The minimum wage should not be increased given the current state of the economy, said the Chairman of the General Assembly of the Association of Industrial Capital in Bulgaria (AIKB) Vasil Velev in the program "Bulgaria, Europe and the World in Focus" on Radio FOCUS.
According to him, the employer organizations have proposed an amount of 646 euros as a compromise value within the envisaged range.
Velev explained that the minimum wage range is formed according to a methodology that takes into account four indicators - the growth of the average and median wage, inflation and long-term growth in labor productivity. Each of them contributes with a weight of 25%.
According to him, in Bulgaria the minimum wage is excessively high compared to the average in comparison with other large economies.
"This leads to a crushing of the differences between the remuneration of people with different qualifications and reduces the incentives for acquiring higher qualifications and greater labor contribution", he pointed out.
"The minimum wage is a wage that is received for a short time by people who do not have qualifications, education and work habits. "They acquire them in a few months and the salary grows," Velev commented.
He warned that excessive administrative increases in the minimum wage could lead to equalization of incomes between low-skilled and more skilled workers, which, in his opinion, is unfavorable for the labor market.
Vasil Velev considered it necessary to update the tax assessments of real estate, as they significantly lag behind market values. According to him, the assessments have not been significantly updated since 2007, while during this period inflation, property prices and incomes have increased significantly.
According to him, however, the increase in tax assessments must be accompanied by a reduction in the rates of taxes and fees calculated on them. He also pointed out the need for a "household waste" fee to be tied to the amount of waste generated, not to the value of the property.
"The polluter pays principle must finally be introduced in our country," said Velev, according to whom the change would limit the gray sector and put honest taxpayers in a fairer position.
Regarding Budget 2027, Velev said that more decisive consolidation and more effective spending of public funds are needed. According to him, revenues should be planned more conservatively, and expenditures should be aligned with the real capabilities of the economy.
"Bulgaria has high wage costs in the "Security" sector, a large number of hospital beds relative to the population and significant capacity in higher education, which is not used effectively," he also said.