site.btaOpposition Proposes Zero Tax for Reinvested Profit, Warns New Budget Could Stifle Investment and Cause Serious Budgetary Trouble

The opposition Continue the Change - Democratic Bulgaria proposes zero tax rate for investment profit and warned that the government’s new budget could stifle investment and push the country into serious budgetary trouble. "This new left-wing government is leading Bulgaria into huge budgetary trouble, and if measures are not taken, it will soon be too late," said Continue the Change - Democratic Bulgaria MP Martin Dimitrov, in the corridors of the National Assembly, as quoted in a press release of his Yes, Bulgaria party.

Yes, Bulgaria is part of the Continue the Change-Democratic Bulgaria coalition.

"This is the most left-wing budget and the largest tax increase in more than 20 years. Social security contributions are being raised by 2%, the maximum social security income is increasing to a record high, and the dividend tax is reportedly going up. We'll see exactly how much in the final budget, but something like this seriously hurts investment activity. This sets Bulgaria back and increases the deficit,” Dimitrov stated.

The MP criticized the ruling parties for "indulging in reckless populism" without including any cost-cutting measures in the draft budget. He reminded that it was his party that proposed such measures and a gradual introduction of zero rate for reinvested profits.

"Estonia did this with great success in 2000 and attracted a lot of serious investment. That is why Estonia now has European incomes," Dimitrov emphasized. When asked by a reporter about Boyko Borissov's accusations regarding the budget of the previous CC-DB and GERB governments, Dimitrov replied:

"I expect that Borissov will soon blame the state of the public finances on [the founder of Bulgarian state] Khan Asparuh. Something like, 'Why did Khan Asparuh come here and establish his state here of all places?'. The facts are that during our cabinet [in 2021], the deficit was 2%. In 2026, it should be 2% again and the current government cannot achieve that." 

Fellow CC-DB deputy Bozhidar Bozhanov added that a month ago his party proposed a package of right-wing measures.

His colleague Ivaylo Mirchev said that October 31 is the deadline for submitting the budget but it not ready yet. According to him, this is a clear sign that the ruling party obviously has serious problems and hesitations. 

"Today the minimum wage is one thing, tomorrow it's another; first they raise taxes and social security contributions, then they don't raise them—it's complete chaos," said the co-chair of Yes, Bulgaria.