"Economic Policy Review" Bulletin ISSN 1313 - 0544

BG Remittances

Part of disposable income in each country comes from funds earned in another country and sent or brought home. The difference between money received from abroad and paid to foreigners determines whether a country is a net exporter or importer of labor. As it could be expected, these flows have the largest positive values (as % of GDP) in less developed countries where emigration and seasonal employment in other countries are most significant*...

New IME Campaign: "State Expenditures in Bulgaria"

IME / 08.02.2010
The Institute for Market economics started a new campaign at the beginning of 2010, attempting through observation and analysis to asses the transparency, soundness and efficiency of public expenditures. The long term objective is to reduce the cost of government and more freedom for citizens.

On Crafts or the Story of a Shoemaker

Zornitsa Slavova / 08.02.2010
Imagine you are a shoemaker. You decide to open a small workshop and to earn your living through the best that you can do. You win customers and who reward your skills more often. You work hard, pay your taxes and your clients are satisfied. One day a group of strangers enters your workshop...

Old Subsidies with a New Railway Chord

Tzvetelina Nenova / 08.02.2010
The State Railways succeeded to attract much attention in the first days of the New Year. Fist, the strike of railway workers led the Ministry of Finance to transfer the subsidy rapidly in January totaling 13.3 million, but last Wednesday the Council of Ministers decided to increase capital by 24 million to enable the State Railways to pay off government-guaranteed loans...

Tax Freedom Day… late during the crisis

Petar Ganev / 08.02.2010
June 1 2010 is the day on which we will stop working for the state and start working for ourselves – more precisely at 16 hours and 23 minutes on Tuesday (1 June 2010). In 2010 Bulgarians will work for 5 months to pay various taxes and duties, i.e. to fill state treasury. The so-called “Tax freedom day” in recent years occurs at the end of May but in 2010 it will move to June.

Social security payments, rather than the VAT

Petar Ganev / 08.02.2010
During the week there was active discussion during the week whether and how to reduce the VAT in Bulgaria: a more drastic 2-percent reduction from the next year or 0.5 percent every 6 months? The news for lowering taxes should sound good, but in case there is an alternative that is far more attractive. If we tear down taxes, then let us focus on the most problematic ones, namely those on labor...

Bulgaria – The Country with Two Faces

Velin Peev / 08.02.2010
Undoubtedly, this week was marked by the passions around Rumyana Jeleva’s hearing at the European Parliament. The general conclusion among the media and the public was that the incident is yet another shameful stain on the reputation of Bulgaria to Europe and worldwide. This is not far from the truth. Yes, it is required to disclose all information in her declaration of property until she was MEP and it was not done. A rule – broken...

Do Not Raise the Deficit*

Team of Bulgarian macroeconomists** / 08.02.2010
This week the Bulgarian President became spokesman of the creeping rehabilitation of the “virtues” of budget deficits. It seems that the Prime Minister and his colleagues see political advantages in this idea and are keen on softening the fiscal policy too...