01.08.2023

Based on data from the monthly reports on the cash performance of the budgets of first-level spending units, the balance of the Consolidated Fiscal Programme (CFP) on a cash basis as of end-June 2023 is positive, amounting to BGN 177.7 million (0.1 % of forecast GDP) and is formed by an excess of revenues over expenditures under the national budget of BGN 167.4 million and under EU funds of BGN 10.2 million. The improvement of the budget position in June is mainly related to revenues and is due, on the one hand, to the higher proceeds connected with the deadline (30 June) for submitting the 2022 annual tax returns under the Corporate Income Tax Law and for paying the corporate income tax and the alternative taxes under the same law, respectively; on the other hand, it is due to the payments made by the European Investment Bank, having a one-off effect for the year, for the projects financed under the Modernisation fund, which are formed by deductions from auctions of emissions trading allowances, revenues from dividends paid to the state by state-owned enterprises, etc. Thus, the deficit formed for the first five months of the year was fully offset in June and the CFP budget balance at the end of the first half of the year is positive.

As of June 2023, CFP revenues, grants and donations are to the amount of BGN 31,404.0 million. Proceeds have increased by BGN 3,156.1 million (11.2 %) compared to those reported as of June 2022. Tax and non-tax proceeds under CFP rise by BGN 3,370.9 million in nominal terms, while proceeds from grants and donations (mostly EU programme and fund grants) are by BGN 214.8 million less as compared to the amount reported for the same period of the previous year.

Tax proceeds (including revenues from social security and health insurance contributions) are to the amount of BGN 24,580.4 million. Proceeds from taxes and social security and health insurance contributions have grown by BGN 2,341.4 million (10.5 %) compared to those reported for the same period of the previous year, forming 78.3 % of the overall CFP proceeds for the period. Revenues from direct taxes  amount to BGN 4,946.1 million, increasing by BGN 634.8 million (14.7 %) compared to those reported as of June 2022. Proceeds from indirect tax (mostly VAT) amount to BGN 10,454.4 million (a drop by BGN 95,4 million, or by 0,9 % compared to those reported as of June 2022). Proceeds from other taxes (including other taxes under the Corporate Income Tax Law, property taxes, etc.) amount to BGN 1,720.6 million (including BGN 676.6 million targeted contributions to the Electricity System Security Fund) or the growth is BGN 806,5 million compared to the proceeds reported as of June 2022. Revenues from social security and health insurance contributions are BGN 7,459.3 million, registering growth of BGN 995.5 million (15.4%) compared to the same period of 2022.

Non-tax revenues amount to BGN 5,620.8 million (growth of BGN 1,029.5 million, or 22.4 % compared to the same period of 2022) and are mostly formed by revenues from state, municipal and legal fees, revenues from rents, concession revenues, greenhouse gas emission allowance revenues, etc. In June, revenues (BGN 384.5 million) were received from the European Investment Bank for the projects financed under the Modernisation Fund. The supported projects are in the areas of renewable electricity generation, modernisation of energy grids and energy efficiency. Funds were received to finance the modernisation of the electricity distribution network in Bulgaria with the aim of attaining accelerated electrification of transport, implementation of solutions for storage, decarbonisation and decentralisation of electricity consumption and production. The Modernisation Fund is financed via the proceeds from the auctioning of emissions trading allowances under the EU Emissions Trading Scheme and its aim is to support the transition towards climate neutrality in ten lower-income EU countries. The beneficiary countries are Bulgaria, Croatia, the Czech Republic, Estonia, Hungary, Latvia, Lithuania, Poland, Romania and Slovakia. In the segment of non-tax revenues, in June revenues of BGN 407.0 million were also received as dividends for the state from state-owned enterprises.

Proceeds from grants and donations amount to BGN 1,202.7 million.

The expenditures under CFP, including the contribution of the Republic of Bulgaria to the EU budget, amount to BGN 31,226.3 million as of June 2023. For comparison, the expenditures under the CFP as of end-June 2022 amounted to BGN 27,071.9 million. In nominal terms, expenditures have increased by BGN 4,154.4 million compared to the first half of 2022 (15.3 %). The most significant increase in the individual expenditure indicators is recorded in terms of pension expenditures (BGN 2,081.1 million), as well as in the part of staff expenditures (BGN 1,044.8 million), capital expenditures (BGN 673.4 million), etc. The growth in expenditures results from enacted legal acts, including changes in the area of pensions, existing programmes for payment of compensation to electricity consumers, payment of liabilities under the budget of the Ministry of Regional Development and Public Works, enforceable higher amounts of remuneration in a number of administrations, etc. 

Non-interest expenditures amount to BGN 30,029.0 million (growth of BGN 4,158.5 million, or 16.1 % compared to those reported as of June 2022). Non-interest current expenditures amount to BGN 27,820.5 million. Capital expenditures (including net increment of state reserve) amount to BGN 2,175.1 million. The current and capital transfers to other countries amount to BGN 33.5 million. Interest payments amount to BGN 349.7 million (a drop by BGN 39,0 million, or by 10,0 % compared to the same period of 2022).

The part of Republic of Bulgaria's contribution to the EU budget, paid from the central budget as of 30 June 2023, amounts to BGN 847.6 million, which complies with the current legislation in the area of EU own resources.

Fiscal reserve as of 30.06.2022 is BGN 12.9 billion, including BGN 12.5 billion fiscal reserve deposits in BNB and banks and BGN 0.4 billion receivables under the EU Funds for certified expenditure, advance payments, etc.

The Consolidated Fiscal Programme performance data as of 30 June 2023 are published on the website of the Ministry of Finance in “Statistics” section. The statistical data are accompanied by an Information Bulletin on the Execution of the State Budget and the main indicators of the consolidated fiscal programme, which presents a short analysis of the performance of the key budget parameters on a consolidated level and by constituent budgets.