PM: Bulgaria Firmly Out of EU Fiscal Pact if Common Taxes Required

Bulgaria will firmly stay out of the new EU Fiscal Pact if it requires tax harmonization, Bulgarian PM Boyko Borisov declared in Brussels. Photo by EPA/BGNES

Bulgaria is not going to participate in the new EU Fiscal Pact if it requires that taxation policies be harmonized, Bulgarian Prime Minister Boyko Borisov has declared in Brussels at the emergency meeting of EU leaders.

Right before the start of the forum, Borisov made it clear that Bulgaria has one single condition for joining the EU Fiscal Pact – a brainchild of French President Nicolas Sarkozy and German Chancellor Angela Merkel which is supposed to improve economic integration in Europe, and thus help solve the EU debt crisis.

In Borisov's words, the condition of Bulgaria, which currently has the lowest tax rates in the EU, is that the new EU Fiscal Pact should not stipulate tax harmonization among the "euro zone plus" that are going to join it.

"Taxation policy must be reserved for each individual state but of course the Bulgarian government will support any measures against tax fraud," Bulgaria's PM said in Brussels.

"I hope that the debates here will focus not only on fiscal discipline but also on economic growth," he added, as cited by the Bulgarian National Radio.

Borisov further said that Bulgaria should be entitled to be part of the new EU Fiscal Compact from its current position as an "observer" state, i.e. one that is yet to join the euro zone and adopt the common European currency.

"I hope that we will be able to achieve this because some states have made it clear that they are not even going to adopt the euro at all; I don't what kind of a seat they deserve at the table but we, especially Bulgaria which has a currency board, and whose currency is pegged to the euro, are entitled to such a seat, and it is important for us to be aware of what's happening in the euro zone," the Bulgarian PM stated.

For the time being, the UK remains the only EU member state, which – as early as the last EU summit in December 2011 – made it clear that it was going to stay out of the agreement for closer EU fiscal and economic convergence.

Poland has warned that it is not going to support the new EU Fiscal Pact unless non-euro states are granted the status of observers at meetings of the Eurogroup, i.e. the 17 states using the euro.

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