Bulgaria Sees Budget Surplus in July, Expects Deficit in August

Bulgaria's budget balance under the so called Consolidated Fiscal Program registered a surplus of BGN 138.4 M in July 2012, the Finance Ministry announced Friday.

"A major factor for revenues to surpass spending is the greater income from EU Operational Programs. At the end of July, the European Commission reimbursed some of the funding under the EU programs and funds that were supposed to be reimbursed in August. According to preliminary estimates, a deficit of about BGN 122 M is expected in August, with the budget balance for the first eight months of 2012 remaining about the same as for the first six months," the Finance Ministry explained.

As of the end of July 2012, Bulgaria's budget had a surplus of BGN 200.3 M for the seven-month period, compared with a deficit of BGN 720.5 M for the same period of 2011.

In the first seven months of the year, Bulgaria's budget saw a surplus of BGN 521.1 M under the national budget, and a deficit under the EU funding transactions amounting to BGN 320.7 M.

Compared with the same period of 2011, in January-July 2012 Bulgaria's budget balance on cash basis improved by 1.2 pp of the GDP, or BGN 920.9 M.

Bulgaria's total income and international funds under the Consolidated Fiscal Program amounted to BGN 15.6 B at the end of July, or about 54.3% of the projection of the 2012 State Budget Act; this is an increase of 10.5% (BGN 1.48 B) year-on-year largely due to more revenues from indirect taxes, non-tax income, and EU funding.

Bulgaria's total tax revenues in Jan-July 2012 amounted to BGN 12.422 B, or 57.5% of the annual projection. Direct taxes brought the Bulgarian budget BGN 2.413 B, or 62.9% of the projected 2012 amount. Indirect taxes raised BGN 6.353 B (55.9% of the projection), including BGN 4.062 B from VAT (57.2% of the projection), BGN 2.206 B from excise taxes (53.4%), BGN 70 M from customs duties (58% of the projection for 2012), and BGN 15.6 M from insurance premium tax (65.2% of the projection).

Bulgaria's income from other taxes amounted to BGN 509 M (61.7% of the projected amount for 2012); social and health insurance payments amounted to BGN 3.146 B, or 56.6% of the projected sum of the year.

In the first seven months of 2012, Bulgaria's non-tax income and foreign funding amounted to BGN 3.176 B, or 44.4% of the projected sum for 2012.

Bulgaria's spending in the first seven months of the year were BGN 15.398 B, or 51.6% of the projection for 2012; current non-interest spending amounted to BGN 12.805 B (56.8% of the projection); capital spending amounted to BGN 1.607 B (30.2% of the projection), and interest payments amounted to BGN 481.3 M (67.1% of the 2012 projection).

Bulgaria's contribution to the EU budget in January-July 2012 was BGN 503.7 M in accordance with regulation 1150/2000 of the Council of the European Union.

As of the end of July 2012, Bulgaria had a fiscal reserve of BGN 7.1 B.