31.01.2019

Based on the monthly reports from first-level spending units, the Consolidated Fiscal Programme (CFP) balance on a cash basis for 2018 is positive, amounting to BGN 137.0 million, or 0.1% of the projected GDP, and is formed by a national budget surplus of BGN 251.7 million and by a EU funds deficit of BGN 114.7 million.

The CFP revenues and grants in 2018 stand at BGN 39,646.0 million, or 103.7% of the annual estimates. Compared to the previous year, tax and non-tax revenues have risen by BGN 3,739.2 million, or by 11.2%, and grant proceeds – by BGN 590.2 million, or by 38.8%.

Tax proceeds, including revenues from social security contributions, total BGN 32,235.7 million, which accounts for 103.5% of the tax revenues planned for the year.

Direct tax revenues amount to BGN 6,132.8 million, or 106.5% of the estimates planned for the year, growing by BGN 488.5 million (8.7%) as compared to the previous year.

Indirect tax revenues amount to BGN 15,531.0 million, which accounts for 102.5% of the annual estimates. Compared to the 2017 data, proceeds in this group have grown by BGN 998.5 million, or by 6.9%. VAT proceeds amount to BGN 10,064.0 million, or 102.9% of those planned. The amount of non-refunded VAT as of 31 December 2018 is BGN 53.1 million. The excise duty revenues amount to BGN 5,203.2 million, or 101.0% of the annual estimates. Customs duty proceeds amount to BGN 226.2 million, or 119.0% of the estimates for the year.

Proceeds from other taxes, including property taxes and other taxes under the Corporate Income Tax Law, amount to BGN 1,113.8 million, or 101.4% of the annual estimates.

Revenues from social security and health insurance contributions are BGN 9,458.2 million, which accounts for 103.6% of the estimates for the year. Compared to the previous year, the revenues from social security contributions have risen by 13.1%, or by BGN 1,093.0 million, in nominal terms. 

Non-tax revenues amount to BGN 5,299.6 million, or 112.7% of the annual estimates.

Grant proceeds amount to BGN 2,110.8 million.

CFP expenditures, including the contribution of the Republic of Bulgaria to the EU budget for 2018, amount to BGN 39,509.0 million, which accounts for 100.5% of the annual estimates[1]. For comparison, the 2017 CFP expenditures amount to BGN 34,471.1 million. The nominal increase is due both to the higher national budget expenditures and to the increasing expenditures under the European Union fund accounts. The growth of national budget expenditures is mainly due to the higher amount of capital expenditures (mostly related to priority infrastructure projects, investment projects in the defence sector, etc.), an increase in the health insurance and social payments (a baseline effect for pension expenditures as a result of the increase in July 2017, the two-step increase in the minimum pension in 2017 as from July and October, as well as the new increase in pensions as from July 2018), the higher staff costs mostly resulting from the increase in the remuneration of pedagogical staff within the system of secondary education, etc., an increase in the subsidy expenditures (mainly related to the amendments to the Energy Law as from 1 July 2018 changing the mechanism of revenue collection and generating expenses to electricity producers through the Electricity System Security Fund), etc., while it is capital expenditures under EU fund accounts that are mostly growing. 

Non-interest expenditures amount to BGN 37,737.4 million, which accounts for 101.2% of the annual estimates. Non-interest current expenditures for 2018 amount to BGN 32,361.7 million, capital expenditures (including net increment of state reserve) amount to BGN 5,321.6 million. The current and capital transfers to other countries amount to BGN 54.1 million. Interest payments amount to BGN 688.2 million, or 95.3% of those estimated for 2018.

The part of Bulgaria’s contribution to the EU budget, as paid from the central budget in 2018, amounts to BGN 1,083.4 million, which complies with the existing legislation in the area of EU own resources, i.e. Council Decision 2014/335/EU on the system of own resources of the European Union, Council Regulation (EU, Euratom) No 608/2014 of 26 May 2014 laying down implementing measures for the system of own resources of the European Union and Council Regulation (EU, Euratom) No 609/2014 of 26 May 2014 on the methods and procedure for making available the traditional, VAT and GNI-based own resources and on the measures to meet cash requirements, as amended by Council Regulation (EU, Euratom) 2016/804 of 17 May 2016.

The fiscal reserve^[2] as of 31.12.2018 amounts to BGN 9.4 billion, including BGN 9.0 billion of fiscal reserve deposits in the BNB and in banks and BGN 0.4 billion of receivables under the EU Funds for certified expenditure, advance payments, etc.

The Consolidated Fiscal Programme implementation data as of 31 December 2018 are published on the website of the Ministry of Finance, in Statistics section. The statistics is accompanied by an Information Bulletin on the Execution of the State Budget and the Main Indicators of the Consolidated Fiscal Programme, which represents a short analysis of the performance of the key budget parameters on a consolidated level and by constituent budgets.

[1] Estimates to the 2018 State Budget of the Republic of Bulgaria Law (promulgated in issue 99 of the State Gazette of 12 December 2017, in force since 1 January 2018, amended by issue 103 of 13 December 2018, in force since 13 December 2018).

[2] The scope of the fiscal reserve indicator is in line with §1, item 41 of the Additional Provisions of the Public Finance Law.