Bulgaria MPs OK Budget Bill 2013 amid Sharp Criticism

Bulgaria's Budget 2013 passed first reading Thursday, following five hours of debates.

The bill was passed with 122 votes in favor and 60 votes against.

Budget 2013 was not backed by MPs from the left-wing Coalition for Bulgaria, the ethnic Turkish Movement for Rights and Freedoms (DPS) party, the right-wing Blue Coalition, and nationalist party Ataka.

The bill was supported by MPs of center-right ruling party GERB and 16 independent MPs.

Bulgaria's Parliament approved the budget of the judiciary and the Financial Supervision Commission as proposed by the government.

Budget 2013 envisages increased spending on social policy, education, culture, and healthcare, according to reports of the Bulgarian National Radio (BNR).

The bill provides for a GDP growth of 1.9% mainly driven by domestic demand and a deficit of around 1.3%.

Starting January 2013, the minimum wage will increase by BGN 20 to BGN 310, and the minimum social security thresholds will go up from BGN 2000 to BGN 2200.

As of April 2013, pensions will increase on a differentiated basis by an average 9%.

Starting 2013, interest earnings from deposits of natural persons will be taxed at 10% and a turnover tax rate of 7% on online gambling will enter into force.

Finance Minister Simeon Djankov, who presented Budget 2013 to Parliament, commented that the main goals of the bill were the preservation of financial stability, the stimulation of economic growth, and the protection of the most vulnerable groups.

Citing Eurostat data, Deputy Chair of GERB Dimitar Glavchev suggested that the income of the average Bulgarian would be 61% of the income of the average Greek in 2013.

Glavchev pointed out that the income of the average Bulgarian had been 41% of the income of the average Greek in 2005.

He argued that the change had happened because Bulgaria's economy was growing at a higher pace than that of the EU.

"Back in 2010, Bulgaria outpaced Romania by per capita income growth, which means that the government's fiscal and macroeconomic policy is aimed in the right direction," the GERB MP noted.

"The revenue part is very tense and ambitious but it has been planned with a lot of precision and is absolutely achievable and real," Glavchev added.

Sergey Stanishev, leader of the Bulgarian Socialist Party (BSP), responded by saying that "none of GERB's budgets was implemented as planned."

He claimed that GERB had smothered small and medium-sized businesses, adding that payments on public procurement were not being transferred.

"The state has become the most high-risk and the most unpredictable factor," Stanishev declared.

Ivan Kostov, leader of the Democrats for Strong Bulgaria (DSB) party, suggested that Budget 2013 did not envisage a brave tax reform which was highly necessary.

Martin Dimitrov, head of the Union of Democratic Forces (UDF), observed that the biggest mistake in Budget 2013 was that it would stifle small and middle-sized businesses.

"Budget 2013 will cement Bulgaria's unenviable position of the most stable, yet impoverished, EU Member State, which is plagued by serious unemployment, low incomes, and a lack of prospects for a better life," DPS MP Aliosman Imamov commented.