Bulgaria Registers BGN 565 M Deficit in Jan-Feb 2012

Bulgaria has completed the first two months of 2012 with a budget deficit of BGN 565 M on cash base, the Finance Ministry announced Saturday providing data for the so called "Consolidated Fiscal Program", including the state budget and EU transactions.

Thus, in January-February 2012, Bulgaria's state budget registered a deficit of BGN 327.6 M, while Bulgaria's EU payment balance (i.e. the EU funds received minus the country's contribution to the EU budget) is a negative BGN 237.4 M.

The Finance Ministry points out the slight improvement year-on-year, by BGN 185.5 M, as in Jan-Feb 2011 the Bulgarian budget deficit was BGN 750.5 M.

As of the end of February, Bulgaria's state income from revenues and aid amounted to BGN 3.681 B, or 12.8% of the annual projection for 2012; it has seen an increase of 11.5%, or BGN 378.4 M, year-on-year, which is primarily due to a rise in the income from VAT, the Ministry said Saturday.

Bulgaria's total income from taxes in the first two months of 2012 amounted to BGN 3.127 B, or 14.5% of the 2012 projection. Of those, BGN 499.7 came from direct taxes (13% from the projected sum); BGN 1.699 B – from indirect taxes (14.9% from the projected sum).

VAT contributed BGN 1.080 B to the income from indirect taxes (15.2% of the projection), excise taxes – BGN 595.6 M (14.4%), customs duties – BGN 18.3 M (15.2%).

Income from other taxes including property taxes amounted to BGN 84.7 M, or 10.3% of the projected sum for 2012.

As of February 29, 2012, the government's income from health insurance and social security payments amounted to BGN 843.7 M, or 15.2% of the projection.

Bulgaria's non-tax income amounted to BGN 553.8 M in Jan-Feb, or 7.7% of the projection.

Bulgaria's total spending in the first two months of the year, including its contribution to the common EU budget, amounted to BGN 4.246 B, or 14.2% of the projection for 2012.

The Bulgarian budget has seen growing spending on subsidies and capital spending, which stems from "the efforts for accelerated absorption of EU funds", according to the Finance Ministry. The earlier payment of agricultural subsidies to farmers has also added to the spending increase, it said.

In Jan-Feb, Bulgaria's non-interest spending amounted to BGN 3.421 B (15.2% of the projected sum), capital spending, including contributions to the state's fiscal reserve, amounted to BGN 326 M (6.1% of the projection for the year), and interest payments amounted to BGN 257.2 M (35.9% of the projection).

Bulgaria's contribution to the common EU budget paid before February 29, 2012, amounted to BGN 241.6 M in accordance with regulation 1150/2000 of the Council of the European Union.

As of the end of February, Bulgaria's fiscal reserve amounted to BGN 3.8 B.

The Finance Ministry explained Saturday that as of early March 2012 the European Commission has refunded to Bulgaria subsidies paid out in December and January, worth BGN 683.9 M, thus "compensating the temporary decline in the resource of the fiscal reserve since the beginning of the year."

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