Bulgaria is number one in the European Union in fuel prices - 34.5% per year. In just one month, diesel has jumped by 13.5%, bTV calculates.
In response, the state announces measures worth over 300 million euros, and for 2027 it offers higher tax breaks, a new threshold for VAT registration and larger food vouchers.
„The package of measures so far is something like light infantry - the heavy artillery has not been taken out. At the same time, we must take into account three factors. The first is that our country is in a position to report a record budget deficit – that is, the resources are seriously limited“, commented in „This Morning“ Stefan Antonov, journalist and financial expert.
„Second, if we exclude market distortions and abuses of a monopoly or cartel position, which regulators must monitor. The third thing is that we have both a global inflationary cycle and a huge increase in the money supply in Bulgaria“, Antonov pointed out.
„Over the past year, 9% of GDP flowed into Bulgaria in the form of loans that the Zhelyazkov government withdrew. Banks have granted loans for another 9 billion euros from last June to this June – that is, 16% of the money supply grows only through bank lending," the expert explained.
"If we have such an injection of money into the economy, it means that part of the shock is compensated by the fact that society begins to live on credit and maintains its standard of living with credit. This is in no way sustainable", he said.
"The relative share that we see as growth is due to the fact that Bulgarian fuels have a low base. The reason for this is that we have low tax and excise compared to other member states", said Tsvetomir Nikolov, an analyst in the "Energy and Climate" program at the Center for the Study of Democracy.
"I assume retail prices were compared and it depends on whether they were compared before or after taxes – I assume after taxes. From there you can see the large increase in price. Otherwise, in retail trade before taxes, according to EC data, we fall slightly below the EU average – we have about 10% cheaper fuels before taxes“, Nikolov explained.
According to him, the low excise duty and low VAT are what make the big difference in the column for consumers compared to those in Germany, for example.
„With the export ban on Bulgarian fuels, we have a large surplus of both gasoline and diesel, which should suppress prices. Even if we accept the fact that we closely follow international prices and ignore the fact of exports, then the refinery makes a big profit. "Many questions arise here," commented Tsvetomir Nikolov.
When asked how the re-allowing of fuel exports will affect prices, he said that there should not be a significant economic shock, but there will certainly be an accelerated increase in prices because demand will increase.