Parliamentary Budget Committee Approves Conclusively 2020 State Budget Update

The National Assembly Budget and Finance Committee Sunday on approved conclusively draft revisions to the 2020 State Budget Act moved by the Council of Ministers to reflect the new realities brought about by the COVID-19 crisis. The updated budget decreases the revenues, increases the expenditures, and allows the Government to incur a larger amount of debt.

As tax and non-tax revenues in the budget will fall short of the 2020 targets by an estimated 2.44 billion leva, the budget balance is to be updated from zero to a deficit of 3.5 billion leva (2.9 per cent of projected GDP). The COVID-19 containment effort and the economic stimulus package will require a 1.43 billion leva increase of the transfer from the State budget to the public social insurance budget (1 billion leva to disburse layoffs-avoiding compensations and 430 million leva to offset the expected shortfall of revenues from social security contributions).

The Committee voted down proposals by the opposition BSP for Bulgaria, which wanted the State to pay a minimum wage plus social security to the people left without incomes due to the crisis: those on unpaid leave and the self-insured, while the anti-epidemic restrictions are in force, grant aid for agricultural producers and those supplying meat and milk to the market, exemption from municipal property use fee of people who have been forced to close down their eateries and waiver of VAT for the products they were unable to sell. BSP leader Kornelia Ninova told bTV that the measures her party proposes would cost a total of 1.5 billion leva, which could come from a suspension of spending on military modernization projects.

The Committee refused to support the Government's proposal to seek financing from the IMF.

In the medium-term programme for issuing debt on the international markets (approved in 2015), the cap on new debt is raised to 10 billion euro from 8 billion euro. Over 5 billion euro has already been used up since 2015. LN/LG

Source: BTA