Bulgaria’s Parliament approved on December 23 a Cabinet proposal to allocate 1.2 billion leva, or 613.6 million euro, for pensions and measures to counter high energy prices.
The funds come from higher-than-planned tax revenue collection this year, but will be spent in 2022, according to the Cabinet’s proposal.
Each pensioner will receive an additional 60 leva a month in January-June next year, regardless of the size of their pension, at a total cost of 750 million leva.
The remaining 450 million leva will go towards compensating high electricity and natural gas prices for non-household consumers in the first quarter of 2022.
Separately, MPs approved an amendment to the VAT Act to extend the duration of the reduced VAT rate on a number of goods and services, which was due to expire at the end of the year. Now, the nine per cent VAT rate will remain in effect until the end of 2022.
The lower tax rate has been applied to restaurant sales, catering services, books, baby foods and baby hygiene products, general tourism and charter bus services, gyms and other sports facilities.
Both the reduced VAT rate and the additional spending approved by Parliament were framed in the proposals as measures meant to reduce the economic impact of the Covid-19 pandemic.
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