The plan that the government has sent to the EC envisages that the deficit in Budget 2027 will be 4.3% of GDP.
This was stated to the Bulgarian National Radio by Lachezar Bogdanov, chief economist at the Institute for Market Economics, specifying that this is not the full budget, but there are basic parameters set in it.
"This reduction in the deficit is achieved with a complex of several measures that they have indicated. We are waiting, of course, to see whether they will finally enter this option. There are some tax increases related to excise duties on tobacco and gambling taxation. The largest measure is the "excess profit" tax. This is a worrying approach from a purely budgetary point of view, a one-off, extraordinary measure, targeted by list against certain businesses. ... On the expenditure side of Budget ‘27, there are two more significant changes - personnel costs, for which we have not yet seen what they intend to do for optimization in order to save money, they have stated that there will also be personnel optimization in the security sector; the other is a reform of the TELK system, but there we are not exactly clear what they will change," he explained.
In his words, if the optimization in the public sector does not take place, there will be an increase in expenses and a larger deficit and the government will be faced with the situation of either losing the deficit or introducing new tax increases.
There are quite a few reserves in revenue collection, if the tax administration works better, Bogdanov believes:
"If the loopholes for tax avoidance are closed, there will be a higher collection rate without raising taxes, i.e. you lighten up part of the gray economy - you bring money into the budget. This is also a tool that should be relied on to an increasing extent. This will be the future of our fiscal policy - to collect more and more what is in the laws, there are simply people and businesses that avoid it".