Bulgaria to Aim to Contain 2014 Budget Gap Below 3%/GDP

Business » FINANCE | August 12, 2014, Tuesday // 17:30| Views: 1060 | Comments: 0
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Bulgaria: Bulgaria to Aim to Contain 2014 Budget Gap Below 3%/GDP Caretaker Finance Minister Rumen Porozhanov. Photo BGNES

Bulgaria’s 2014 budget gap will be above plan but the interim cabinet will try to contain it below the three-percent ceiling required by the EC.

The caretaker Finance Minister Rumen Porozhanov blamed what he said was unrealistically high revenue side of the budget bill adopted by the dissolved 42nd Parliament for the need to revise the budget and increase the deficit. The 2014 state budget has been adopted with an expected deficit equivalent to 1.8% of the projected Gross Domestic Product (GDP).

In an interview for state-run news agency BTA Porozhanov said that end-year revenue from taxes and excise duty is currently forecast to be some BGN 900 M below target but there are options to boost revenue collection in the remaining months of the year.

He also blamed the need to widen the budget gap to increased government spending and the frozen funding under the EU’s operational programmes Environment and Regional Development.

The key problem is that a rise of 11% in budget revenue is projected for 2014 compared to 2013, while GDP is planned to grow by 1.8%. The discrepancy is impossible to eliminate completely despite all revenue-boosting measures, said Porozhanov.

He later told a news conference that ex-customs chief Vanyo Tanov will be appointed again as head of the Customs Agency in a bid to improve revenue collection which Porozhanov estimated as unsatisfactory.

Referring to frozen EU funding, Porozhanov said that the caretaker cabinet is trying hard to have payments to Bulgaria under Operational Programme Environment restored to shrink budget deficit.

Suspended payments to Bulgaria under the Regional Development programme have been resumed under all axes, caretaker Deputy Prime Minister Ekaterina Zaharieva said at a news conference on Tuesday.

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Tags: Caretaker Finance Minister, Rumen Porozhanov, Vanyo Tanov, Ekaterina Zaharieva, budget deficit
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