site.btaAssociation of Industrial Capital in Bulgaria Does Not Support Most of Government-Proposed Anti-Crisis Measures

The Association of Industrial Capital in Bulgaria (AICB) does not support most of the government-proposed anti-crisis measures, the Head of the Association, Vassil Velev, said Monday at a meeting of the National Council for Tripartite Cooperation.

In Velev’s words, there are not any proposals to tackle the most serous issues which are inflation and uncertainty. The main problems are the uncertain business environment and lack of workforce, he said. Many objections were submitted to AICB by members of the Association, who stand against the way of compensating the end price of fuels for persons. The government-proposed compensation mechanism creates difficulties for traders, Velev said.

On May 18, Prime Minister Kiril Petkov said that the government will offset growing fuel prices by a discount of 0.25 leva per litre of A95-H petrol and diesel any time drivers fill up their tanks at filling stations. 

Fuel traders will have to pay the discount from their own pockets first and only then claim the money from the state, Velev explained. Moreover, the fuel reliefs will lower traders’ liquidity, and the measure is not properly targeted as there is no distinction between those of them who can afford to pay and those who cannot, he said.

AICB does not support either reducing VAT to 9% on central heating. According to the Association only one fifth of Bulgarian citizens use central heating, and half of them live in Sofia, where the salaries are the highest.

AICB does not support reducing VAT on bread to zero, either. According to AICB, introducing zero VAT on bread and making VAT on alcoholic beverages 20% again helps one industry and harms three or four other industries, especially tourism which has suffered the most during the crisis, Velev argued. He proposed that adequate compensations for the household users of electricity who are buying from the free market should be introduced.

The government-proposed measure of 9% VAT on natural gas for VAT registered companies will have no effect, Velev argued.

AICB supports the proposed tax relief for parents, as well as cutting the interest on overdue payments from 10% to 8% on an annual basis.