As unpleasant as it is, the increase in pension insurance and the increase in dividend tax is not the biggest problem of this budget. This is the lack of a strategic goal and the huge increase in expenses relative to GDP, Lidiya Shuleva, former Deputy Prime Minister and former Minister of Economy and Social Policy, pointed out in an interview with the Bulgarian National Radio.
In the program "Something More" she commented on the draft budget for 2026.
"The main policy is to ensure spending policies – and they are 48.5% of GDP, which is unacceptable. Until 2025, the 40% threshold was not violated, as required by law", Shuleva believes.
Shuleva pointed out that raising social security contributions by 2 percentage points represents a 10% increase in social security contributions:
"But these huge expenses will be financed not only by social security contributions. A huge debt is also planned - 26.5 billion leva, which leads to the payment of a lot of interest. This is where the expenses swell a lot and taxes are being resorted to to compensate. On the one hand, they are raising taxes and social security contributions, and on the other, debts are increasing for a huge spending policy," the former deputy prime minister explained.
And he predicted that this would lead us "to a debt spiral" in 2027 and 2028:
"In 2027 and 2028 (according to the 3-year forecast) we will pay 3 and a half times more money for interest on debts compared to 2024, from 400 million leva to 1.2 billion leva. Things are more critical in terms of the macro framework, not so much in the real sector. There will also be a reflection there."
Shuleva predicts tension between the public and private sectors, which are facing a number of difficulties - the situation in Europe, tariffs, war.
About "Lukoil" Shuleva commented that it was too late for the special manager and there was no need to wait for the buyer:
"A special manager should have been introduced much earlier, and not at the last minute to do balancing acts and use exotic methods. This law has not yet been published and we do not know what it provides," she said.
According to her, Bulgarian citizens will feel the benefits of entering the eurozone if there are investments in production with high added value, because they guarantee high incomes for business and workers.
"Let's draw a conclusion about how fiscal policy affects the business environment. "With this budget, the impact will be negative," warned Lidiya Shuleva.