Bulgaria two-month Budget deficit at 1.4B leva

Bulgaria two-month Budget deficit at 1.4B leva

Bulgaria's Budget deficit for January-February 2010 was 1.4 billion leva, the Finance Ministry said on April 1. In February alone, the deficit was about 900 million leva.Consolidated Budget revenue for the first two months of the year was 3.1 billion leva, 27.4 per cent less than in the same period of 2009. Indirect taxes, the single largest source of revenue for the Budget, were down by 34.9 per cent to 1.27 billion leva.Value-added tax (VAT) revenues were 684.1 million leva, a decrease of 45.7 per cent from the same period of last year. The reason, according to the Finance Ministry, was the "one-off high revenue received in January 2009 as a result of increased public spending in December 2008."The ministry said that the trend for declining imports remained in place, while exports continued growing. "The lower imports, as well as lower prices on some commodities are reflected in the declining VAT revenues from imports. The increase in exports, on the other hand, leads to increased VAT refunds, which also contributes to lower VAT revenue," the ministry said in a statement.Consolidated Budget spending, including Bulgaria's contribution to the European Union budget, was 4.5 billion leva, the bulk of it on current spending - 3.62 billion leva. Overall, Budget spending increased by 22.2 per cent compared to the same period of 2009."The most serious pressure on the spending side of the Budget in the first two months of the year comes from the increased social security and health care payments during the period," the ministry said.The higher spending was caused by the pension increases that went into effect on July 1 2009, the ministry said.The country's fiscal reserve at the end of February was 6.35 billion leva.

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