01.06.2023

Based on preliminary data and estimates the budget balance of the Consolidated Fiscal Programme (CFP) as of end-May 2023 is expected to be deficit, amounting to BGN 1.2 billion (0.6 % of the forecast GDP). For comparison, a surplus of BGN 0.6 billion was reported for the first five months of 2022, which means that on an annual basis the budget balance for the period has deteriorated by around BGN 1.8 billion. The trend from the previous months of the year is continuing – expenditures growth (around 17 per cent) significantly outpaces revenues growth (around 9 per cent) which is the main reason for the deterioration of the budget position compared to the previous year.

Key CFP parameters on the basis of preliminary data and estimates:

As of May 2023, CFP revenues, grants and donations are expected to be BGN 24.8 billion, increasing by BGN 2.0 billion (8.6 per cent) compared to those reported as of end-May 2022. Compared to the same period of 2022, tax revenues under CFP have risen in nominal terms by BGN 2.04 billion (11.5 per cent), non-tax revenues – by BGN 0.12 billion (3 per cent), while proceeds from grants and donations (mainly grants under EU Programmes and Funds) have decreased by BGN 0.18 billion. As regards tax revenues, proceeds from direct taxes, social and health security contributions and other taxes have grown at good pace, while indirect taxes have continued to record a more moderate growth, mainly due to lower proceeds in terms of revenues from VAT on imports. One of the factors for the above is the decrease in the price of crude oil imported for processing purposes, as compared to the price reported in the same period of the previous year. In addition, the amount of VAT on imports has also been affected by the exchange rate of the US dollar as well as the decrease in the quantities of imported goods giving rise to VAT, including crude oil.

The Consolidated Fiscal Programme expenditures, including the contribution of the Republic of Bulgaria to the EU budget, as of May 2023 amount to BGN 26.0 billion. For comparison, the expenditures under the CFP as of May 2022 amounted to BGN 22.2 billion. The most significant increase in the individual expenditure indicators is recorded in terms of pension expenditures, as well as in the part of subsidies, maintenance and staff expenditures, etc.

The part of Republic of Bulgaria's contribution to the EU budget, paid from the central budget as of 31 May 2023, amounts to BGN 0.7 billion, which complies with the current legislation in the area of EU own resources.

The statistical data and the Information Bulletin on the execution of the state budget and the key indicators of the Consolidated Fiscal Programme based on data from the monthly reports on the cash performance of the budgets of the first-level spending units as of May 2023 will be published on the website of the Ministry of Finance at the end of June 2023.