April 24 (SeeNews) - Bulgaria's draft budget for 2023 made by the caretaker government proposes a consolidated budget deficit equivalent to 6.4% of this year's projected gross domestic product (GDP), the finance ministry said.
The government intended to limit the budget deficit at 3% of GDP by means of a proposed set of spending and revenue measures, the finance ministry said in a statement on Friday. However, a lack of political support for the measures has prompted the caretaker government to prepare a budget draft based on the finance ministry's spring macroeconomic forecast and the preliminary estimates from the 2022 budget report. At present, the caretaker government is operating under the provisions of last year's budget that were extended into 2023.
The consolidated budget deficit for 2024 and 2025 is set at 5.2% and 4.6% of GDP, respectively.
The deficit of the general government sector is projected at 6.1% of GDP this year. The national statistical office said last week that the general government sector recorded a deficit of 4.65 billion levs in 2022, equivalent to 2.8% of GDP.
The country's GDP is projected to increase by a real 1.8% this year, to 184.5 billion levs ($103.6 billion/94.3 billion), and then grow by 3.3% in 2024 and 3.2% in 2025.
Government debt is forecast at 46.7 billion levs at end-2023, or 25.3% of GDP. The ratio of government debt to GDP is then expected to rise to 29.6% in 2024 and 33% by the end of 2025.
Budget revenue is expected to come in at 65.8 billion levs in 2023, equivalent to 35.7% of GDP, while expenses are seen at 77.7 billion levs, or 42.1% of GDP.
The tax policy for the 2023-2025 period will focus on improving revenue collection, curbing tax fraud and reducing administrative burdens and costs for businesses and individuals, the ministry added.
The government also plans to increase pensions by 12% this year.
In 2023, Bulgaria is set to receive two tranches at 2.88 billion levs in total under the EU-approved National Recovery and Resilience Plan.
(1 euro = 1.95583 levs)