ADDRESS OF PRIME MINISTER SIMEON SAXE-COBURG

Views on BG | August 20, 2001, Monday // 00:00

Broadcast on Bulgarian National Television and Bulgarian National Radio on August 19, 2001)

Dear Compatriots,
Along with the activity for forming new ministerial teams and district administrations, the government sets to effectively perform its management program. It is done in full conformity with the commitments we undertook to establish a functioning market economy, improve the living standards of common people and to irreconcilably combat corruption.
For this purpose the government takes the following measures:
1. Carrying out a radical tax reform from January 1, 2002, by the means of:

- Introducing zero rates for income taxes for incomes omounting to 110 levs per month including;
- lowering the rate of income taxes from 20-38 percent down to 18-29 percent;
- introducing zero rates for profit tax in case of reinvesting the profit;
- introducing zero rates for taxes on the capital profit for trade in securities.
The planned reducing of the tax burden will result in creating a favourable climate for investments, rapid economic growth and opening new jobs.
2. Restructuring of organization and functioning of the customs houses
including attracting of foreign inspectors to exercise more intensive control. These measures are taken to increase the collectability of the customs receipts, to reduce smuggling and the resulting from it corruption and will bring part of the shady economy into light.
3. Introducing high rates, transparency and efficiency of privatization
including the following amendments to legislation:
- All preferences to Managers` and Employees` Associations to be canceled;
- the privatization method of `negotiations with potential buyers` to be canceled;
- establishing the Privatization Agency as the only body to seal the privatization deals;
- establishing of a specialized body carrying the post-privatization control outside the Privatization Agency.

Guaranteeing transparency and creating equal economical conditions for all the participants in the privatization process will revive the interest of the reliable investors.
4. Cutting down the budget expenditures of the state administration
including downsizing the staff by 10 percent as of January 1, 2001. The government intends to take purposeful measures with a view to optimize the activity of the state administration.
5. As of October 1, 2001 rising the prices of electric and heating power
by 10 percent at the most. This hard decision results from several joint factors: a permanent trend of rising the prices of the energy carriers, changed lev/dollar rates and last, but not least - the intentionally frozen prices from 1999 to this day.
6. Rising the minimum wage from 85 up to 100 levs
as of October 1, 2001. The government considers this more than 17-percent rise of the minimum wage as the first step towards a considerable rise of the incomes of the most underpaid Bulgarians.
7. Double rise of the family allowances
as of January 1, 2002. The government is aware that in spite of the considerable burden for the budget, it is just a little contribution to resolving the demographic problems of Bulgaria and the poor financial circumstances of the young families. This clearly signals the importance the government attaches to the young generation.
8. Setting up a state guarantee fund for microcrediting from October 1, 2001
amounting to 20 million levs. The fund is to guarantee low-interest and free-interest credits to stimulate private entrepreneurship in the municipalities with the lowest rates of unemployment.
These are only the first and imperious measures to carry out reforms the government set as its task to implement. Other social and economic mechanisms are also in a process of concretizing which are to result in opening new jobs and developing branches of high priority for the country.
During the last two months Bulgaria was and still is on the front pages of the world press and in the limelight of the e-media. If we were to pay for such advertisement, it would have cost mullions of dollars. Bulgaria is now in vogue and we must take advantages of it.
The positive comments of the international community concerning the events in Bulgaria and the public support for my cabinet give me the reason to appeal: let us show greater solidarity with economically handicapped and more optimism about Bulgaria`s future.

Thank you!

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