Bulgaria's 2014 budget gap more than doubles y/y

By bne IntelliNews February 3, 2015

Bulgaria's general government budget deficit widened to BGN3.05bn (€1.6bn) in 2014 from BGN1.4bn in 2013 due to underperforming revenue and expenditures rising quicker than initially planned, according to finance ministry data.

Last year's deficit was equal to the revised target of 3.7% of GDP, which compares to a gap of 1.8% of GDP in 2013. Budget expenditures (contribution to the EU budget included) rose 6.7% to BGN32.5bn, while revenues edged up 1.5% to BGN29.4bn. 

Tax revenue increased 2.9% to BGN23bn, equal to 98.8% of the plan. That figure would have been smaller if the underperforming VAT income was not compensated by the faster-than-expected growth rate of revenue from social insurance contributions.

Current expenditures rose 4.8% to BGN26.6bn, mainly due to the BGN958mn increase of social expenses to BGN13.7bn. Salaries advanced 3.5% to BGN4.6bn and subsidies climbed 8.7% to BGN1.6bn. Capital expenditures rose 19.4% to BGN4.9bn.

The government targets to reduce this year's budget deficit to 3% of GDP. The finance ministry has projected a surplus of BGN85mn for the first month of 2015.

Bulgaria's general govt budget, BGN mn 2013 2014 Change, y-y Change, y/y
Revenues and grants 28,981.4 29,406.8 425.5 1.5%
Tax revenue 22,370.2 23,028.2 658.0 2.9%
Non-tax revenue 3,966.1 3,457.0 -509.2 -12.8%
Grants 2,645.0 2,921.6 276.6 10.5%
Expenditures 29,495.7 31,500.2 2,004.5 6.8%
Wages and salaries 4,452.1 4,606.8 154.8 3.5%
Social and healthcare expenditures 1,368.7 1,429.5 60.8 4.4%
Maintenance 4,705.6 4,725.5 19.9 0.4%
Interest expenditures 688.7 579.8 -108.9 -15.8%
Social expenditure, scholarships 12,750.5 13,709.0 958.4 7.5%
Subsidies 1,429.4 1,554.3 124.9 8.7%
Capital expenditure and net state reserve gain 4,100.7 4,895.4 794.6 19.4%
Contribution to the EU budget 934.1 954.9 20.7 2.2%
BUDGET BALANCE -1,448.4 -3,048.2 -1,599.8 110.5%
Source: FinMin        
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