08.11.2022

The Economic and Financial Affairs Council (ECOFIN) held its regular meeting in Brussels today. The Finance Ministers of EU-27 discussed the economic and financial impact of the war in Ukraine, the implementation of the Recovery and Resilience Facility, the annual report of the European Fiscal Board and the US Inflation Reduction Act adopted in August this year.

The focus of the discussion of the Finance Ministers was the additional fiscal burden caused by the war in Ukraine and its implications; the support measures that governments provide to households and businesses must be well targeted and cannot remain in place for too long, given the need to ensure the sustainability of public finances.

The Council discussed Directive 1999/62/EC (the Eurovignette Directive) concerning certain provisions on the taxation of motor vehicles. The aim of the Commission is to encourage Member States to apply the “polluter pays” and the “user pays” principles. The Republic of Bulgaria insists that the directive should include a text according to which the possibility of zero rates would not apply in our country, Minister Velkova said. Given the difference between tax and fee, their different objectives and the fact that revenues from taxes and fees are allocated to different budgets (state and municipal), as well as the potential distortion of competitiveness in the internal market if such a text is not included, at this stage Bulgaria cannot support the Presidency’s compromise.

The ECOFIN Council approved the package of legislative proposals on supervision of banks and their activities, which implements the Basel III capital requirements standard, as well as the draft Council conclusions on EU statistics.

Within her working visit to Brussels, Minister of Finance Rositza Velkova held a bilateral meeting with the Greek Minister of Finance Christos Staikouras. Minister Velkova familiarised her Greek counterpart with the Parliament’s decision adopted by constitutional majority on 27 October 2022, whereby the Bulgarian government has been entrusted with the task of speeding up the negotiations with the European institutions and euro area member states, as well as the technical preparations for the introduction of the euro in order to meet the target date of 1 January 2024. The two Ministers also discussed other issues of mutual interest, including the exchange of experience in the field of income taxation as regards targeted measures to support low-income citizens and joint measures to counter tax avoidance.