Bulgaria’s consolidated budget deficit was equivalent to 2.2% of the gross domestic product at end-October, exceeding an unrevised full-year target of 1.8%.

According to preliminary estimates released by the Finance Ministry on Monday, the shortfall in the consolidated budget totalled BGN 1.78B as of end-October, higher than the gap of BGN 443M recorded a year earlier.

The government led by Prime Minister Boyko Borisov, which took office last week, plans to raise about BGN 4.5B of new debt to meet a new, higher deficit target of 3.7%, to be adopted as part of a planned revision of the 2014 state budget, Finance Minister Vladislav Goranov said earlier on Monday.

The minority coalition government plans to submit to Parliament a new budget update proposal to replace the one tabled by the caretaker government which is targeting a shortfall equivalent to  4.0% of projected 2014 GDP.

Budget revenue for the first 10 months of the year was BGN 24B, or 77.3% of full-year plan, improving by BGN 253M compared to the same period of 2013

Tax revenue (including social insurance contributions) amounted to  BGN 19.2B as of end-October, or 78.7% of 2014 plan and 3.7% higher in nominal terms than tax revenue collected in the equivalent period last year. The increase, however, is way below the too optimistic projections made by the Socialist-led government that resigned in July.

Budget spending for the first 10 months of 2014 totalled BGN 25.8B, equal to 79.3% of full-year plan and 6.5% higher than spending for the same period of 2013 mainly due to accelerated absorption of EU funds and increased healthcare and social insurance payments as well as pension payments, the Finance Ministry said.