site.btaAmCham Bulgaria CEO Mihaylov on Draft State Budget, Lukoil-related Legislative Changes

American Chamber of Commerce in Bulgaria (AmCham Bulgaria) CEO Ivan Mihaylov commented on Sunday that instead of improving the environment and taking care of the well-being of companies and their development, the proposed 2026 state budget will be a major blow to businesses and will not lead to the elimination of the grey economy. He was commenting on the 2026 State Budget Bill for Bulgarian National Radio. 

He added that he is deeply skeptical that the planned tax increases, especially of the dividend tax, will lead to better tax collection. There is certainly no sane person who believes that this will have a positive effect on tax collection and the State's finances, he commented. 

Mihaylov noted that the Government's arguments for a dividend tax should not be ignored, but noted the lack of dialogue with the business community and the smoothness of the processes so that it can be prepared for the steps that follow in the future. 

The State should take a responsible approach to the budget in terms of how all the planned changes will affect the business climate in the context of the country's entry into the eurozone. The business community must be heard because it always speaks reasonably, and ways must be found so that the 2026 budget does not deal a serious blow to businesses but rather helps them enter the eurozone more easily, Mihaylov argued. 

AmCham Bulgaria supports the position of employers' organizations on the draft state budget, and bilateral chambers are also expected to express their views on this issue, Mihaylov said further.

On the subject of continuing compensation for businesses for expensive electricity, Mihaylov pointed out that cheap electricity had ensured the continuation of companies' activities, the preservation of jobs, and some prosperity and security for citizens. "We cannot say that it was a handout. In Bulgaria, the price of electricity is one of the highest on a daily basis," he added. 

On the subject of US sanctions on Russia's oil company Lukoil, Mihaylov pointed out that active work is required on the part of the Bulgarian government to negotiate the continuation of the derogation. This is something that must be done as a matter of absolute urgency and priority, Mihaylov said. An exchange of letters will not be enough to obtain any extension of the derogation, he added.

Regarding the latest legislative changes related to a special commercial administrator for Lukoil, Mihaylov noted that this mechanism has not worked everywhere and has not preserved the activity of the companies that were managed in this way. "If we do not take any steps, yes, this option will quite reasonably remain the only one, but it is short-term and must also be agreed upon by both parties," Mihaylov commented. According to him, technically this is possible, but the opinion of the owner and whether it solves the problem with the derogation must be decided by the US and Lukoil.

In response to a question about whether Bulgarian Energy Holding (BEH) could acquire the Lukoil refinery in Burgas (on the Black Sea) and whether this would be a good option, Mihaylov said that the question is whether Bulgaria can afford it, pointing out that the purchase would require taking out loans. At the same time, he said that BEH could potentially own this enterprise, but raised the question of how confident Lukoil's customers would be in continuing to use the refinery's products. "The concern is that, yes, operations will continue and ownership will change, but without consent and without the sanctions being lifted, no one would consume these products for fear of becoming subject to sanctions," Mihaylov said.