For another year, the caretaker government will prepare the state budget.
"The figure that was given, with the proviso that it was a preliminary budget, indicated a deficit of about 12 billion or so. This takes into account a planned increase in revenues of around 6.3 billion and a 18 billion increase in expenses - almost 3 times higher growth", commented financial expert Boris Petrov in the program "The Day ON AIR".
High inflation is not expected in 2025
"I see no reason for such a large increase in costs. We have to think about consolidation through spending," Petrov pointed out.
According to him, the cost measures are very high and this always exceeds the possibilities.
"It is time to think and re-read the fiscal rules, to read Article 98 of the Law on Public Finances, to see that there it says that if there is no adopted budget, 1/12 of the expenditure set out is spent in the budget for the previous year. The fiscal rule of a deficit of up to 3% must also be observed. We have brakes in the legislation that must be activated, even during the mandate of a caretaker government," Petrov reminded Bulgaria ON AIR.
Stabilizing the fiscal position is achievable, the expert believes. Petrov emphasized that the municipalities received extremely large sums this year by decision of the National Assembly.
"Small municipalities received large sums. It is interesting to see how these municipalities voted in the elections. It may turn out that fiscal inaction is a great advantage", the guest analyzed.
Should taxes be raised?
"If taxes are not raised, we will not have enough funds for a capital program. There will also be no funds from the Investment Recovery Plan. Then we will have to prioritize spending. Regarding taxes - if we rein in spending, we may not need to raise taxes. The constant rotation of political parties leads to bloat of the administration, which turns out to be a permanent process," commented Petrov.
A double-digit salary increase in the budget sector should not be repeated, the financier insisted. When asked if the business is ready for the Eurozone, Petrov expressed the opinion that the banking sector is in an advanced phase of preparation.