Bulgarian Parliament Completes Approval of 2013 Budget

Bulgaria’s Parliament passed in a final vote next year’s budget, which targets a deficit of 1.3 percent of economic output and includes a 10 percent tax on interest from deposits as spending rises before elections.

The item-by-item vote was completed, Deputy Finance Minister Ventsislav Goranov told reporters in Sofia today. The plan assumes economic growth of 1.2 percent under a pessimistic scenario and 1.9 percent under an optimistic one. Next year’s budget-deficit target is unchanged from this year.

“This is a realistic budget that will support the government’s policies,” Goranov said in Parliament. “The budget is designed to boost economic growth and consumption.”

Bulgaria, the EU’s poorest country in terms of gross domestic product per capita, weathered the global crisis without borrowing from lenders abroad. Growth slowed to 0.5 percent from a year earlier in the third quarter, the same as in the previous two quarters.

Revenue is estimated at 30.6 billion lev ($20.4 billion) or 37.5 percent of GDP, a 6.4 percent increase from this year. Spending is projected at 31.7 billion lev, or 38.8 percent of GDP, a 6.5 percent increase from 2012.

The government plans to keep personal and corporate income taxes unchanged from a flat 10 percent next year, in an effort to attract more investment and boost growth, according to the budget.

To contact the reporter on this story: Elizabeth Konstantinova in Sofia at ekonstantino@bloomberg.net

To contact the editor responsible for this story: James M. Gomez at jagomez@bloomberg.net

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