Bulgarian State Admits Delaying Millions in Payments to Businesses

Business | March 4, 2010, Thursday // 19:53|  views

The state policy of asking firms to which the government owes money for completed projects to give up 10% of the sum if they want to get paid in February-March 2010 is the brainchild of Finance Minister, Simeon Djankov. Photo by BGNES

The Bulgarian State owes about BGN 600 M in Value Added Tax (VAT) to businesses, according to official information of the Finance Ministry.

The information, published Thursday, further points out, that the Ministry will make everything possible to submit 50% of the payments, according to budget, by the end of March.

The Deputy Finance Minister, Vladislav Goranov, has scheduled meetings with counterparts from the Ministries of Defense, Labor and Social Policy and the Environment, to discuss ways to repay the State obligations to the private companies.

90% of the delayed payments are due to construction businesses. Companies with contracts with the Defense Ministry and the Management of Environmental Activities (PUDOOS) will receive 50% of the money owed to them while the Social Ministry is still to give an answer about their payments.

The negotiations with businesses contractors for the Regional Ministry are ongoing and currently the Finance Ministry has agreements with 22 companies, including holdings and consortiums for over BGN 90 M.

Just before Christmas, the Finance Ministry, the Regional Ministry and the Construction Chamber signed an agreement for the repayment of BGN 200 M with BGN 40 M to be received by the end of January and BGN 80 M in each February and March.

The Finance Ministry reports that road construction companies have received BGN 38 M in January, while, according to the Chamber's records, no payments have been made in February and March.

The State is further making payments only to businesses that have agreed to an anti-crisis concession in the amount of 10% of the overdue sum.

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Tags: Simeon Djankov, finance minister, state debt, debts, VAT

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