30.06.2021

Based on data from the monthly reports on the cash performance of the budgets of first-level spending units, the budget balance of the Consolidated Fiscal Programme (CFP) on a cash basis as at end-May 2021 is negative, amounting to BGN 140.6 million (0.1 % of forecast GDP), and is formed by an excess of revenues over expenditures under the national budget of BGN 58.5 million and a deficit under EU funds of BGN 199.1 million.

The CFP revenues, grants and donations as of May 2021 are to the amount of BGN 20,475.6 million, or 43.0 % of the annual estimates. Compared to the same period of the previous year, proceeds as of May 2021 have grown by BGN 2.8 billion, (16.1 %). The growth as compared to the previous year is due to the higher tax and non-tax revenues which increased by BGN 3.1 billion, while the receipts in terms of grants decreased by BGN 0.3 billion. When comparing non-tax revenues and VAT revenues, it should be taken into account that in April 2021 revenues with a one-off effect for the year were received; this is the initial concession fee paid to the state from the concession of Sofia Airport.

Tax proceeds under CFP, including revenues from social security and health insurance contributions, total BGN 15,725.9 million, which is 42.5 % of the annual plans. Proceeds from taxes and social security and health insurance contributions have grown by BGN 1.7 billion (12.3 %) compared to those reported for the first five months of the previous year, forming 76.8 % of the overall CFP proceeds for the period In the area of tax revenues, their significant growth in May this year is mainly due to a baseline effect in April and May 2020 – the period of the strictest containment measures and restrictions. The trend of a gradual recovery of the key taxes, as evident from the previous months, has continued. Significant growth on a monthly basis compared to the same month of the previous year is reported in revenues from VAT, personal income tax, social security contributions, etc. Proceeds from excise duties have already overcome the delay from the first months of the year and the proceeds in this group exceed those reported for the first five months of 2020.

Revenues from direct taxes amount to BGN 2,714.5 million, or 38.9 % of the annual estimates. Indirect tax revenues amount to BGN 7,516.0 million, (44.0 % of the annual estimates), with VAT revenues amounting to BGN 5,264.3 million (46.9 % of the plans), excise duty revenues – to BGN 2,129.9 million (38,2 % of the estimates), and customs duty revenues – to BGN 97.9 million (41.8 % compared to the annual estimates). Proceeds from other taxes, including property taxes and other taxes under the Corporate Income Tax Law, amount to BGN 662.1 million, or 51.6 % performance of the annual estimates. Revenues from social security and health insurance contributions are BGN 4,833.2 million, or 41.3 % of those planned for the year.

Non-tax revenues amount to BGN 3,666.1 million, which accounts for 55.6 % of the annual estimates, and are mostly formed by revenues from state, municipal and legal fees, revenues from rents, concession revenues, greenhouse gas emission allowance revenues, etc.

Proceeds from grants and donations amount to BGN 1,083.6 million.

The expenditures under the CFP, including the contribution of the Republic of Bulgaria to the EU budget, amount to BGN 20,616.2 million as of May 2021, which is 39.3 % of the annual estimates. For comparison the expenditures under the CFP as of end-May 2020 amounted to BGN 16,323.4 million. The significant growth of expenditures in the first five months of 2021 compared to the same period of the previous year is related, on the one hand, to the lower base in 2020 when the expenditures on addressing the COVID-19 pandemic were significantly lower, while as of May 2021 these expenditures are significant, and, on the other hand, to the income policy, the policies in the social sphere and the higher expenditures on the administration laid down in the 2021 State Budget of the Republic of Bulgaria Law.

Considered by economic elements, the most significant increase is reported in social and health insurance expenditures. In the area ofpension expenditures, BGN 524.2 million were spent on payment of an allowance of BGN 50 to the pensions of all pensioners for the months from January to May. In addition, pension expenditures were also influenced by the increase in the amount of the minimum contributory-service and retirement-age pension and of the maximum amount of the pension as from the beginning of the year, as well as by a baseline effect of the increase in pensions in July 2020. In the area of health insurance expenditures, these report an increase related to higher expenditures on tackling the pandemic and arrangements for financing health establishments in the context of the emergency epidemic situation, including expenditures on medicines, tests, consumables and protective equipment, funds to support front-line staff in the fight against COVID-19 (supplementary monthly remuneration of BGN 1,000), payment to medical staff for vaccination of the population against COVID-19, monthly allowance of BGN 600 for doctors, BGN 360 for nurses and midwives and BGN 120 for hospital attendants, etc. The payments under the 60/40 measure, the 80/20 measure, the “Keep Me” measure, the “Working Capital Support For SMEs Affected by the Temporary Anti-Epidemic Measures” measure administered by the NRA, etc., have contributed to the growing expenditures on subsidies for non-financial enterprises. Capital expenditures have also increased in comparison to the same period of the previous year, which is due to payments related to investment projects of the Bulgarian army, road infrastructure sites, etc.

Non-interest expenditures amount to BGN 19,584.1 million, which is 39.1% of the annual plan. Non-interest current expenditures amount to BGN 18,094.8 million, Capital expenditures (including net increment of state reserve) amount to BGN 1,477.8 million, The current and capital transfers to other countries amount to BGN 11.5 million. Interest payments amount to BGN 349.0 million, or 53.1 % of those planned for 2021.

The part of Republic of Bulgaria's contribution to the EU budget, paid from the central budget as of 31.05.2021, amounts to BGN 683.2 million, which complies with the current legislation in the area of EU own resources.

Fiscal reserve as of 31.05.2021 is BGN 9.34 billion, including BGN 8.49 billion fiscal reserve deposits in BNB and banks and BGN 0.85 billion receivables under the EU Funds for certified expenditure, advance payments, etc.

The Consolidated Fiscal Programme performance data as of 31 May 2021 are published on the website of the Ministry of Finance in the Statistics section. The statistical data are accompanied by an Information Bulletin on the Execution of the State Budget and the main indicators of the consolidated fiscal programme, which presents a short analysis of the performance of the key budget parameters on a consolidated level and by constituent budgets.