"I do not see any long-term policy in the Ministry of Finance. The last major tax changes were made in 2006-2007, when the situation was quite different. But almost 20 years have passed since then. A system cannot be renewed in some way for 20 years.
This is what the economist Georgi Kadiev from "Normal State" told the BNR.
On the assurance of the Minister of Finance that taxes and insurances for individuals will not be raised, he expressed his opinion:
"It's just a one-year delay. We are inevitably headed in this direction because of one simple fact – expenses are rising a lot, and there is no additional income. All the measures that the Ministry of Finance is now proposing are one-off, such as the bank excess profit tax or the tax amnesty. Next year there won't be any, even if they accept them now, which is also quite doubtful.
The real size of the hole in the budget is probably BGN 18 billion, which the finance minister is talking about, Kadiev admits. According to him, we can afford BGN 6 billion if we want to comply with the Maastricht criteria. This would be approximately a 3% deficit, he calculated and added:
"The remaining BGN 12 billion must be found from somewhere or be cut as expenses.
The financier reminded that the line ministry had to submit the draft budget for the next year for consideration in the National Assembly by October 31. Now there is an elected parliament, why don't they bring it in, he asked on the air of the show "12+3".
According to him, once it is imported, it will be seen what exactly is recorded, because, according to him, the signals are very different.
Georgi Kadiev expressed the opinion that no income will come from the amnesty for unpaid debts to the treasury:
"The theory says that there is a short-term positive effect, ie. some additional revenue comes in, but in the long term the effect is negative because people stop paying taxes, waiting for the next amnesty".
For him, the forecast of the Ministry of Finance in this direction is completely wrong.
"Does it make sense to rush to run a 3% budget deficit when clearly the systems are not holding up. We cannot but raise the minimum wage, we cannot but give the policemen, the military and teachers some kind of increase, accordingly we cannot meet the 3% budget deficit and there is no drama in this", commented the financier. He is adamant that the problem is not the deficit, but whether you can finance it:
"Do you have an economy that can produce enough to pay the interest on this deficit. Here comes the real drama for Bulgaria – in our country there is no economy, there is no investment, GDP growth is due only to domestic consumption and not to production growth, there is no export growth. The government should work in this direction – development of the economy, stimulation of business and external investments, and if there are no external, then public investments".
For him, the measure of tax on excess profits in the banking sector makes sense. According to him, this should have been done a long time ago.
Georgi Kadiev predicts that this parliament will not adopt a budget for next year.