Bulgaria's Government plans to increase product fees, a charge imposed to raise revenue for recycling packaging materials, a move that would further boost the prices of packed goods, Dnevnik daily reported on March 24.

Companies would have to mark the product fee on all packaging, according to a set of amendments expected to be passed by end-April, deputy environment minister Chavdar Georgiev told the daily.

He refused to speculate on the size of increase would be, because the decision had to be co-ordinated with the Cabinet, but said it would take into account the projected annual inflation figure. Annual re-calculations would be carried out until 2011, Georgiev added.

The amendments will force the companies to collect and process packaging materials such as textile, porcelain and wood, along with paper, plastic, glass and metal, which are already covered by existing regulations.

Existing regulations place fixed product fees, depending on the material used for packaging, that are supposed to remain unchanged until 2011. Instead, the annual amount of packaging that has to be collected for recycling has to grow.

In a letter sent to the Economy and Energy Ministry, the Confederation of Employers and Industrialists in Bulgaria (CEIB) said that "such increase of the taxes would have negative impact on the business climate in Bulgaria and would lead to increase in the prices of the main consumers’ goods." The increase was unjustified, the confederation said.

CEIB also said that the obligation to indicate the product tax in the price of the products was inadmissible, with CEIB chief secretary Evgenii Ivanov saying that “the Government has no right to impose a pricing mechanism.” The amendments would damage the business climate, he added.

Bulgarian Industrial Association (BIA) also criticised the initiative, which it branded as "unregulated and unexpected". Marking the product fees on the packaging was against free market principles and European Union practices, BIA said in a statement released after emergency consultations with its branch organisations.