Bulgaria’s Cabinet was scheduled on March 25 2010 to discuss ways to cut costs at ministries as part of measures to recover from the economic crisis and the country’s worsening deficit, with one ministry already announcing a proposal to cut its administrative staff by a third and with Prime Minister Boiko Borissov insisting that officials should not be paid more than Cabinet ministers.
 
Earlier, the Defence Ministry announced a proposal to cut its desk staff by a third, subject to approval at the Cabinet meeting.
 
Borissov, who was to head to Brussels, after a visit to Kuwait, for the meeting of European Union heads of state and government, declined to answer questions about the anti-crisis debate but said that salaries in the ministries should not be higher than those of ministers, news agency Focus said.
 
Economy, Energy and Tourism Minister Traicho Traikov said that there were officials in his ministry who got higher pay than he did.
 
An earlier proposal to increase value-added tax (VAT) by two per cent to 22 per cent has become ensnared in controversy.
 
Traikov said that the long-term effect of increasing VAT was being considered and no decision had been taken yet.
 
Tax measures reportedly were not discussed at the March 24 meeting of Bulgaria’s tripartite council, which is made up of representatives of the Government, employers and unions.
 
The tripartite council is scheduled to resume debate on March 26 on the lists of proposed anti-crisis measures, with talks expected to continue into the weekend.
 
Zhelyazko Hristov, head of Bulgaria’s Confederation of Independent Trade Unions, said that unions opposed increasing VAT and were against a proposed increase in the price of natural gas by 15 per cent from April 1.
 
On March 25, media reports suggested that the VAT increase idea would be abandoned – even though earlier in the week Borissov had insisted on it – and other ways would be found to make up the current 1.5 billion leva Budget shortfall.
 
Media reports said that the hospitality industry was strongly opposed to a proposal that would see the tourism business charged a specially reduced rate of VAT at seven per cent.
 
There have also been differences on a Government idea for a "luxury tax" on high-performance cars, yachts, interests on large deposits and fixed property above a certain size.
 
After the tripartite council talks on March 24, it emerged that employers had put forward a proposal that would see several services currently conducted by the state, instead outsourced to concession-holders.
 
Labour and Social Policy Minister Totyu Mladenov was quoted by Bulgarian-language mass-circulation daily Trud as having said in an interview that he was certain that the Government would find a way for everyone to have a fair share of the burden of the economic crisis, although it could not be an equal share, given that it would not be correct to over-strain vulnerable social groups such as pensioners, people with disabilities and minimum income earners.
 
There appeared to be some items on which consensus would emerge, including the issuing of domestic and foreign debt and the sale of carbon emissions.
 
The fate of the idea to conduct large-scale privatisations also remains unclear, at least in the sense of which assets could be partly or fully sold off. Media reports that Sofia's 120 000 sq m National Palace of Culture would be put up for sale led building manager Hristo Droumev to tell journalists that he would "not allow the building to be turned into yet another shopping mall".