30.06.2014

Fiscal reserve as of 31.05.2014 is BGN 5.8 billion, including BGN 4.9 billion deposits in BNB and banks and BGN 0.9 billion receivables under the EU Funds for certified expenditure, advance payments, etc. In accordance with §1, point 41 of the Public Finances Law Additional Provisions the fiscal reserve scope has been changed to include the receivables under the EU Funds for certified expenditure, advance payments, etc.

Consolidated revenues and grants under CFP for the reported period stand at BGN 11,776.1 million, or 37.9 % of the annual plans for 2014 under the State Budget Law. Compared to the same period of the previous year the revenues under CFP are by BGN 26.3 million less which is due mainly to a basis effect of the received in accordance with the legal time schedule revenues from dividends from state owned enterprises at the end of May 2013 (including of a one-off character). The proceeds from dividends for the state as of 31.05.2014 amount to BGN 4.9 million, while for the same period of the previous year they amounted to BGN 198.7 million, i.e. the proceeds from dividends as of end-May 2013 are by BGN 193.8 million higher than those for first five months of this year. The greatest portion of the proceeds from dividends in May 2013 is of a one-off nature - from the State Consolidation Company EAD to the amount of BGN 148.1 million. It should be taken into account that the statutory deadlines for dividend payment have been changed and the proceeds are to be expected in the coming months.

At end-May 2014 tax proceeds, including revenues from social security contributions, total BGN 9,435.9 million, which is 38.8 % of the 2014 plans. Compared to the same period of the previous year tax proceeds have risen by BGN 246.4 million in nominal terms

Revenues from direct taxes amount to BGN 1,981.8 million or 45.9 % of the annual plan and have risen by 3.6 % compared to January - May 2013. Corporation tax proceeds remain close in nominal terms to those reported for the same period of the previous year, while revenues under the PITL have risen by 7.3 % (BGN 75.8 million).

Revenues from indirect taxes amount to BGN 4,511.6 million, or 35.2 % of the programme for the year, of which VAT revenues amount to BGN 2,935.6 million, or 35.4 %; excise duty revenues - BGN 1,506.7 million, or 34.4 %; customs duty revenues - BGN 58.6 million, or 43.0 %.

Proceeds from other taxes, including property taxes and other taxes under the Corporate Income Tax Law, amount to BGN 439.9 million, or 49.0 % of the plans for 2014.

Revenues from social security and health insurance contributions are BGN 2,502.7 million, or 39.8 % of those planned for the year. Compared to the same period of the previous year tax proceeds have risen by 8.1 % (BGN 187.1 million) in nominal terms

Indirect taxes revenues as of 31.05.2014 decreased by BGN 60.1 million in nominal terms compared to the same period of the previous year as a result of the larger amounts of VAT and excise duties refunded in the first five months of 2014 compared to the same period of 2013, and also of the consumption and imports dynamics. For the period January-May 2013 the VAT refunded amounted to BGN 2,292.6 while for the same period of 2014 - BGN 2,365.0 or by BGN 72.4 million more. The level of non-refunded tax decreased by BGN 165.0 million. The amount of non-refunded VAT lowered from BGN 314.0 million as of May 2013 to BGN 149.0 million as of May 2014. The strict adherence to the statutory deadlines for VAT and excise duties refunds that has started since the beginning of the term of office of the Government and is continuing this year is also in line with the policy of establishing the state as an upright payer and partner of the businesses and is a means for creating normal conditions for growth and development. The basic effect of received in February 2013 arrears to the amount of BGN 65 million should also be taken into account; they had a one-off effect for 2013, so that makes VAT revenues for the two periods incomparable. An impact on the VAT proceeds from imports have also the planned repairs of the manufacturing facilities of a large economic operator which postpones parts of the supplies of raw materials for production and respectively VAT payment due on imports for future periods. It is expected the lower VAT proceeds in the first months of the year due to the planned overall of capacities, estimated at around BGN 90 million, to be gradually compensated in the coming months.

Non-tax revenues and grants amount to BGN 2,340.1 million, or 34.9 % of those planned for the year. The changed deadlines for dividend payments to the state by enterprises with state participation in the capital on the one hand, and the one-off revenues on the other, make data for non-tax revenues incomparable for the two years. Non-tax revenues as of 31.05.2014 amount to BGN 1,578.1 million, while the reported as of 31.05.2013 are BGN 1,749.5 million. Revenues from grants as of end-May 2014 are by BGN 101.3 million lower compared to those for the same period of the previous year, this slow down being compensated in June 2014 when revenues from grants are higher compared to the previous year.

The expenditures under the consolidated fiscal programme, including the contribution of the Republic of Bulgaria to the EU budget, as of 31.05.2014 amount to BGN 12,664.6 million, which is 39.0 % of the annual plans. Compared to May 2013 expenditure under the CFP have risen by BGN 907.8 million (7.7 %), mainly due to the accelerated absorption under European programmes and funds, and to social expenditure growth. It is important to note that expenditure under the EU funds accounts (including national co-financing) have risen considerably by 64.7 % (BGN 605.3 million) compared to the same period of 2013, which is linked to the accelerated EU funds absorption, while national budget expenditure have only risen by 2.7 % (BGN 302.5 million) compared to the reported for the same period of 2013. EU funds expenditure (including national co-financing) amount to BGN 1,540.1 million as of the end of May 2014, the reported for the same period of 2013 being BGN 934.8 million. In structural terms maintenance and interest payments are lower compared to the same period of last year, while capital expenditure and social and health insurance payments have risen. The growth in social expenditure is mainly due to the basic effect of the increase of pensions as from 1 April 2013 and to higher health insurance payment in the first months of 2014 linked to payment of last year liabilities, etc. On the other hand capital expenditure growth (including net increment of state reserve) is again linked with the higher payments under EU programmes and funds. As of end-May 2014 they amount to BGN 1,389.3 million, or by с 40,2 % (BGN 398.2) more compared to the same period of the previous year - BGN 991.0 million.

Non-interest expenditures amount to BGN 11,950.6 million or 40.1 % of the annual plans. Non-interest current expenditure as of May 2014 amount to BGN 10,561.3 million, or 42.6 % of the plans, capital expenditures (including net increment of state reserve) amount to BGN 1,389.3 million, or 27.8 % of the plans for 2014. Interest payments amount to BGN 218.9 million, or 32.7 % of the plans for 2014.

The part of Bulgaria's contribution to the EU budget, as paid as of 31.05.2014 from the central budget, amounts to BGN 495.0 million, which complies with Council Regulation 1150/2000 of 22 May 2000 implementing Decision 94/728/EC, Euratom on the system of the Communities' own resources.

The budget balance on a cash basis under the Consolidated Fiscal Programme (CFP) as of May 2014 is negative, amounting to BGN 888.6 million and is formed by a deficit under the national budget of BGN 362.9 million and a deficit under EU funds of BGN 525.7 million.

Data on the consolidated programme implementation as of 31 May 2014 are published on the website of the Ministry of Finance in category Topical Publications/Statistics.