/ world today news/ Almost continuously in the Bulgarian public space, cries are heard about the danger of “drilling holes” in the state budget. And these are the cries of the yellow-wearing bourgeoisie of Sofia, of the oligarchic circles of GERB and DPS, of the Soros scholarship holders, of the “America for Bulgaria” diners, of the arrogant yuppies of Tsarot, of the newly discovered “Harvardians”, of trainee scientists in western universities, of known and unknown followers of the neoliberal economic and political concept, right-wing political commentators, anthropologists, journalists, etc. And all this in the name of “future generations” who were robbed by the current ones.
The “punched holes” in the budget also became fashionable in December 2022, on the eve of the next extraordinary parliamentary elections, and that on the occasion of the extension of the old budget. The reason for the current attention to the loopholes was the statements of the acting finance minister, Mrs. Velkova, on December 9, 2022, that next year’s budget will be in deficit by BGN 16 billion, that proposals for BGN 6 billion in new expenses have been submitted to the National Assembly. and just to cover the new minimum wage of BGN 850, about BGN 1 billion is needed. In one of the sites, this was defined as a “budget hole”. The apocalyptic picture was reinforced the next day by the official Minister-President, Mr. Gulab Donev, that “increasing the minimum wage in this way is populism, and that with BGN 1 billion, the financial stability of the country is at risk.” Bray, it was a terrible job to increase the incomes of the working poor, to increase pensions! But the pensioners and the working poor “eat the nation’s future”. Look, the rich, the oligarchs, the fraudsters and the fraudsters, the people’s representatives only support the state and fill the state budget and “ensure the future of the nation ?!?!”
This is not a new policy of the official government, this is the old song of the right-wing rabid neoliberals in Bulgaria from the time of Vancho Kostov, Oresharski, Ahmed Dogan, Rumen Ovcharov, the tsarist ex-yupites, Goranov, Donchev, Ananiev, the communist children Hristo Ivanov and Boyko Borisov. This is a continuous twenty-five year general anti-national policy, which has left the Bulgarians in the ranks of the most dying nation in the world, the poorest nation not only in Europe. This is that absurd fundamentalist neoliberal approach leading to the killing of Bulgaria.
Both Donev and Velkova, like all literate people, clearly understand very well the essence of the anti-people neoliberal policy, but they do not have the strength and courage to tell the Bulgarian people clearly and in the right text. This story of “budget holes” can and is high time to end. For this we need a new economic and social policy, a simplified and effective state and municipal apparatus.
The breakthroughs, the big holes in the state budget, are not in the expenditure part, but in the revenue part, a shortfall in revenues from direct corporate taxes. In the EU, the poorest are Bulgaria and Romania, where a ridiculous corporate tax of 10 and 13% has been introduced, i.e. about three times lower than the similar tax in Great Britain and Germany and only for Bulgaria about twice lower than that in Poland, the Czech Republic, Hungary, Slovakia, Lithuania, Latvia, Estonia (in them it is between 19 and 21%). Bulgaria also has the lowest level of labor remuneration. It makes sense for high wages to have lower corporate taxes. On the contrary, what is happening in Bulgaria is a social crime against the people. Tax illogicality has been introduced in Bulgaria. With the lowest corporate taxes in Europe, Bulgarian production is the most energy-intensive, with the most energy costs (electricity, natural gas, oil and fuels) and with the lowest wages. And our prices are already European. Therefore, the huge profit of the Bulgarian business goes for other purposes, not for salaries, not for energy, not for reconstruction and modernization, but for palaces, airplanes, helicopters, yachts, Mercedes, luxury items, villas at home and abroad, etc. n.
In the conditions of crisis (pandemic and energy), Bulgarian business received billions of levs in direct and indirect aid from the state. And where does this money come from? Of course, from the state budget. And now it is filled to about 75% from indirect taxes, mainly from VAT and excise duties. And what are the Bulgarian governments doing? Everyone in chorus raises the slogan: “No increase in taxes”, but see a reduction – it is possible. And they aimlessly and populistically reduce revenues in the budget continuously by lowering VAT rates. Borisov gave the restaurateurs of Dulgokosko Alibegov a VAT from 20 to 9% and the restaurateurs pocketed hundreds of millions of BGN without reducing the prices in the establishments and without raising the salaries of the staff. Following the example of Borisov and Ninova, with the help of the “Harvardians”, he gave Kukusheva’s people hundreds of millions of leva. Instead of lowering the price of bread, it increased, but bakers and flour millers swallowed hundreds of millions of leva, and accordingly the state budget was impoverished with this money. Has anyone noticed that the prices of books and printed matter, even textbooks, have decreased with the reduction of VAT? No such thing. Bulgarian business has no restrictions in the paw. In general, for liberal business fraud and speculation are in the first place, but for Bulgarian business it is on the largest world record scale. Therefore, if the VAT tax breaks for restaurateurs, hoteliers, bakers, flour millers, publishers, etc. are removed. more than 1 billion BGN will appear in the treasury, which will now go into the bottomless pockets of the family fortunes of a number of businessmen, mostly the biggest ones.
In a similar way, the issues with the excise tax are also the same. The prices of everything are rising, including tobacco products and spirits. And accordingly, manufacturers and sellers realize profits that are over 30% higher than before the pandemic and the energy crisis. But the excise duty in our country is frozen at the level of the long past crisis-free time. If it increases within reasonable limits, at least by 15%, a little less than the official inflation, roughly three hundred to four hundred million BGN will flow into the state budget.
There is a huge injustice in Bulgaria, persistently unseen by business organizations, unions and Bulgarian governments. It is in the amount of income tax for individuals and sole traders. A sole trader pays 15% income tax on the company’s profits. As much as the Group of the 20 most powerful economies in the world recommends in 2021. At the same time, the average worker pays a tax of 10%, the same as the tax on the profits of banks that export 75% of their profits abroad. And the big shareholders and equity owners pay the most ridiculous, EU’s lowest dividend tax of just 5%. In Bulgaria, about BGN 7-8 billion are distributed annually as dividends. At 7 billion BGN, this is 350 million. From the tax declarations of some rich people, it can be seen, for example, that the former minister from the party “We continue the replacement” Sabev paid 1 million BGN in corporate tax. If his dividend tax, like the tax of Delyan Peevski, P. Kanev and other rich people, is 15%, the same as the sole trader’s tax and as much as a similar tax in a number of other European countries, then he would pay 3 million to the state treasury. BGN, and a total of about 700 million BGN will flow into the country. But the rich don’t want to pay higher taxes. Therefore, in Bulgaria, no political party proposes the introduction of a luxury tax, such as it is in most EU countries. Such a proposal suits the BSP best, but Ninova stubbornly remains silent and avoids this issue
From the tax, excise and fees of the poor, the state forms the benefits for the rich, i.e. poor rich food. And eat in order, without choice, without need and on the fly. For example, the notorious 25 cents per liter of fuel in the car. This is a waste of money from the state budget for extremely needy consumers, and for the benefit (in the words of Minister Stoyanov) of Lukoil. And it’s unfair. When you allegedly give the driver 25 cents per liter, including drivers of luxury jeeps, security guards of oligarchs, and highly paid representatives of the people, at the same time the prices of pensioner cards for travel in public transport in Sofia increase by 20%. Ninova and a company of politicians from all parties thought of the rich transporters, but forgot about the poor pensioners of Sofia, the vast majority of whom do not have cars, and some of them only have wheelchairs and walkers. It is understandable that the gerberatist Fandakova is against elderly passengers in public transport, but this is an unacceptable inequality, which is ignored by the socialist Ninova.
Business is supported indiscriminately. Of need or without need. If the government wants to introduce order and order in aid to businesses, it should set clear requirements. For example, for energy efficiency. For three years now, billions of BGN have been poured into thousands of Bulgarian companies without them having moved an iota in reducing the energy intensity of their production and services. They endlessly waste energy and for this they receive money from the poor through the state budget. Costs can also be reduced by banning aid to Bulgarian and foreign companies operating in Bulgaria, but registered offshore or paying taxes in other countries (Lukoil, Bulgarian Navy, etc.) or exporting their profits to other countries (75% from banks and insurance companies).
At the same time, an anti-people activity is carried out with the confiscation of the profits of state-owned companies and companies. This puts them in a disadvantageous position compared to private business, because the money is transferred from the public property to the coffers and pockets of oligarchic and big business structures. At the same time, state-owned companies are left without a future – without funds for modernization, reconstruction and development. And it was probably done on purpose so that they could be easily and cheaply privatized by the right buyers.
The important thing is to increase the revenues in the state budget, so that through the development of the economy and above all, fair taxes at the average European level, they provide sufficient revenues in the budget to support activities in the social sphere and increase the incomes of workers and pensioners . It is high time to increase the amount of pension and health insurance by at least 2%. The current amount is infinitesimally low and in the new financial and economic crisis conditions, an infinitesimally low money supply is provided to finance pensions. In addition, the insurance ceiling should be raised from BGN 3,400 to at least BGN 10,000, which is the same as the remuneration of the rich deputies in the National Assembly and managers in the central departments. This would be completely fair, not only for them to increase their salaries every three months, but in ministries and departments to receive disproportionate monetary bonuses.
There should also be a reduction in government spending in some areas and areas. It is high time that the most powerful administrative apparatus (after the Brussels administration) in the EU with over 20 ministries and over 120 central departments and with about 240-250 thousand officials in Bulgaria should be reduced by at least 40,000 people, a significant part of which are highly paid with salaries, and some of them also with very high pensions, elderly people. GERB, through the bloated central, regional and municipal bureaucratic apparatus (and the DPS in some regions and municipalities), regularly secures electoral victories. The reasonable reduction of this bureaucratic apparatus, complicating the lives of people and businesses, would also lead to a reduction of the departmentally secured parliamentary vote for the oligarchy-related GERB and DPS. But in this direction DP, PP “We continue the replacement”, BSP, PP “Bulgarian Rise” and “Vazrazhdane” through their parliamentary groups are terribly silent. The reduction of the state and municipal clerical apparatus would lead to savings of over BGN 1 billion in salaries alone, but there is also a reduction in administrative costs.
Someone will tell us again that this is not the job of a caretaker government. Maybe he’s right. But no one is preventing the official government from pointing out these issues to the Bulgarian society in a straight text and proposing specific partial changes in individual laws in the National Assembly. Otherwise, the talks about the “holes in the state budget” become empty talk and slandering the ignorant Bulgarian public.
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