Another Hangover in the Making?

Novinite Insider » EDITORIAL | November 29, 2006, Wednesday // 00:00
Bulgaria: Another Hangover in the Making? Photo by Yuliana Nikolova (Sofia Photo Agency)

By Milena Hristova

The financial health of the Bulgarian state next year will be fuelled by an unhealthy for the Bulgarian people cocktail.

One of the ingredients is the traditional rakiya hard liquor, most loved when produced in the small distilling factories of small villages. Many villagers will have to forget the ritual of brewing rakiya after MPs decided at first reading to introduce an excise tax. That will certainly be the first huge EU disappointment for the elderly people in the villages. And their much younger and rakiya-loving children and grandchildren in the cities... Not to mention the inevitable slack control over homemade brew and the inevitable increase in alcohol poisoning cases.

The increase in excise duties on coffee and cars is just as controversial as the hardest hit will be the end consumers. Yet they all pale before the plans for a shocking increase in excise duties on fuels. Instead of a single hike in 2007, the Bulgarians will have to swallow the bitter pill of a double hike, those planned for 2007 and 2008 all rolled into one. The arguments for the hike are more than solid. "It's about the army and the promises we made to NATO," politicians say, hardly expecting the people to clap their hands happily.

To raise the excise duty on fuels is the easiest thing to do to insure more revenues into the budget. The easiest, but also the nastiest as it has a direct impact on the levels of inflation.... Not to mention the slack control over fuels' imports and sales and the rosy prospects ahead for the grey market.

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