The Draft State Budget for 2026 envisages key changes in tax policy, an increase in the price of vignettes and cigarettes, as well as a new model for providing benefits to civil servants. [June 26] The deadline for public discussion of the macro framework expires, and the Ministry of Finance convenes the first tripartite debates with unions and business, NOVA and investor.bg report].
Sharp disputes over the record deficit and threat of sanctions from the EC
A main point of tension in the new Budget 2026 is the planned record excess deficit of 5.7% of gross domestic product (GDP) for the last three decades [investor.bg]. The parameter exceeds almost double the Maastricht criteria of 3%, required for membership in the Eurozone. For this reason, economic experts warn that in early July the European Commission is expected to officially launch a penalty procedure against Bulgaria for excessive deficit [investor.bg].
After the deadline for citizens and businesses to comment expired at noon, the Finance Ministry began urgent negotiations within the framework of the Tripartite Council [nova.bg]. The cabinet's plan is for the draft law to be approved by the Council of Ministers on Wednesday (July 1) and submitted for a snap vote in the National Assembly.
What will change for the pocket of the Bulgarian from this summer?
The macro framework provides for a series of restrictive measures and an increase in taxes in order to reduce spending and fill the holes in the treasury:
- More expensive vignettes and cigarettes: The prices of road vignettes for passenger cars are rising dramatically by 30% starting this summer. A new spike in tobacco prices is also expected due to an update to the excise calendar.
- Tax hike: Dividend tax doubles – from the current 5% it becomes 10%.
- Salaries and new rules for civil servants: The minimum wage is fixed at 620 euros, but the maximum social security income is raised to 2300 euros [investor.bg]. There is a serious change for civil servants – From August 1st, for the first time, they will pay part of their personal insurance (in a ratio of 80:20) themselves, instead of being covered entirely by the budget.
- New pensions from July 1st: The planned update of pensions under the "Swiss rule" comes into effect, with the minimum pension becoming 347.51 euros. An important change is that the Covid supplements are being removed for all newly granted pensions.