29.10.2021

Based on data from the monthly reports on the cash performance of the budgets of the first-level spending units, the CFP budget balance on a cash basis as of September 2021 is positive, amounting to BGN 1,067.8 million (0.8 % of the forecast GDP) and is formed by an excess of revenues over expenditures under the national budget of BGN 1,218.3 million and a deficit under EU funds of BGN 150.4 million.

CFP revenues, grants and donations as of September 2021 amount to BGN 37,840.1 million, or 74.8 % of the revised annual estimates^[1]. Compared to the same period of the previous year, proceeds as of September 2021 rise by nearly BGN 5.4 billion (16.6 %). The growth in comparison to the previous year is due to the higher tax and non-tax revenues which have grown by nearly BGN 5.4 billion, whereas grant proceeds are close to the ones reported for the same period of 2020.

CFP tax proceeds, including revenues from social security and health insurance contributions, total BGN 29,600.2 million, which is 75.1 % of the tax revenues planned for the year. Tax and social security and health insurance contribution proceeds grow by BGN 3.6 billion (13.8 %) compared to those reported for the same period of the previous year, forming 78.2 % of the overall CFP proceeds for the period.

Revenues from direct taxes amount to BGN 5,465.7 million, or 71.1 % of the annual estimates. Indirect tax revenues amount to BGN 14,100.9 million, (77.4 % of the annual estimates), with VAT revenues amounting to BGN 9,600.0 million (78.2 % of the plans), excise duty revenues – to BGN 4,260.9 million (75.5 % of the estimates), and customs duty revenues – to BGN 204.4 million (84.7 % of the annual estimates). Proceeds from other taxes, including property taxes and other taxes under the Corporate Income Tax Law, amount to BGN 1,094.1 million, or 87.9 % performance of the annual estimates. Revenues from social security and health insurance contributions are BGN 8,939.6 million, or 72.8 % of those planned for the year.

Non-tax revenues amount to BGN 6,111.4 million, which accounts for 90.5 % of the annual estimates, and are mostly formed by state, municipal and legal expense revenues, rents, concession revenues, greenhouse gas emission allowance sale revenues, etc. In April 2021 there were one-off revenues, which are the initial concession fee from the Sofia Airport concession.

Grant and donation proceeds amount to BGN 2,128.4 million.

The expenditures under the CFP, including the contribution of the Republic of Bulgaria to the EU budget, amount to BGN 36,772.3 million as of September 2021, which is 66.6 % of the revised annual estimates. For comparison, the expenditures under the CFP as of September 2020 amounted to BGN 31,550.9 million. The considerable growth of expenditures as of September 2021, as compared to the same period of the previous year, is related, on the one hand, with the lower base in 2020 when considerably smaller expenditures for fighting COVID-19 were reported in the same period, while for the nine months of 2021 those expenditures are considerable, and, on the other hand, with the income and social policies as well as the higher expenditures for the administration envisaged in the 2021 State Budget of the Republic of Bulgaria Law.

Looking from the perspective of economic elements, there is a considerable growth in the social and health insurance expenditures. As to pension expenditures, BGN 948.6 million have been spent for a monthly addition of BGN 50 to the pensions of all retired persons for January through September. Along with that, pension expenditures are also influenced by the increased amount of the minimum length-of-service and old-age pension, of the maximum pension as from the start of the year, the baseline effect of the pension increase in July 2020, as well as the increase in July 2021. There is an increase in the health insurance expenditures related to the higher expenses for tackling the pandemic and the arrangements for financing health establishments in the context of the emergency epidemic situation:  expenses for medicines, tests, consumables and protective equipment, expenditures supporting front-line staff in the fight against COVID-19 (supplementary monthly remuneration of BGN 1,000), payment to medical staff for vaccination of the population against COVID-19, monthly allowance of BGN 600 for doctors, BGN 360 for nurses and midwives and BGN 120 for hospital attendants, etc. The payments under the 60/40 measure, the 80/20 measure, the Keep Me measure, the Turnover Support for SMEs Affected by the Temporary Anti-Epidemic Measures measure administered by the NRA, etc. have contributed to the growing subsidy expenses for non-financial enterprises.

Expenditures are expected to increase significantly in the last quarter of the year as, in addition to the traditionally higher capital expenditures and those related to the winter period, funds will be provided for the main part of the additional expenses for tackling the pandemic, social support, protection from migratory pressure at the borders, support to businesses and other priority measures to be implemented by the end of the year, which were approved by the National Assembly in mid-September with the adopted Law Amending and Supplementing the 2021 State Budget of the Republic of Bulgaria Law.

Non-interest expenditures amount to BGN 35,124.2 million, which is 68.9 % of the annual plans. Non-interest current expenditures amount to BGN 32,898.3 million. Capital expenditures (including net increment of state reserve) amount to BGN 2,198.0 million. The current and capital transfers to other countries amount to BGN 28.0 million. Interest payments amount to BGN 554.0 million, (84.3 % of those planned for 2021).

The part of Bulgaria's contribution to the EU budget, paid from the central budget as of 30.09.2021, amounts to BGN 1,094.0 million, which complies with the current legislation in the area of EU own resources.

Fiscal reserve as of 30.09.2021 is BGN 10.12 billion, including BGN 9.97 billion fiscal reserve deposits in BNB and banks and BGN 0.15 billion receivables under the EU Funds for certified expenditure, advance payments, etc.

The Consolidated Fiscal Programme performance data as of 30 September 2021 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.

^[1] Estimates to the 2021 State Budget of the Republic of Bulgaria Law (prom., SG, issue 104 of 08.12.2020, amended, SG, issue 77 of 16.09.2021).