The Association of Industrial Capital in Bulgaria (AIKB) will not support the draft budget for 2024. The document does not envisage reforms, on the contrary – such a budget wastes the saved fiscal space without investing in reforms, continues to distribute money “indiscriminately” and contains a material risk of excessive deficit. According to AIKB, the most serious problem of the draft budget is that it takes our country away from the Eurozone.
Among the main arguments for the association’s negative opinion on the 2024 budget are that instead of looking for opportunities for fiscal consolidation, the Ministry of Finance continues the policy of increasing budget expenditures, new budget deficits financed with new government debt and destabilization of public finances. Examples include the unfulfillable forecast for the amount of revenues and the increase in expenses, the optimistic forecast for GDP growth, the maintenance of reduced VAT tax rates, the continuation of the practice of re-regulation and increased administrative burden for business, the increase in the remuneration of employees in the budget sector , without this being accompanied by a reduction in numbers, etc.
AIKB recalls that in its statement it made a forecast for the development of the macroeconomic indicators of the Bulgarian economy and made recommendations for priority policies to be implemented through the state budget of the Republic of Bulgaria in 2024. However, none of the recommendations were taken into account attention when preparing the document.
Despite the refusal of support, the association is satisfied that the draft Law on the State Budget of the Republic of Bulgaria proposed by the government does not provide for a significant change in the tax model and the basic tax rates, although in general the total tax-insurance burden for citizens and businesses is growing. AIKB also supports the record high size of the investment program in 2024.
You will find the full opinion of AIKB on the draft budget for 2024 HERE.
