State budget funded wages in Bulgaria next year would be increased by up to 10 per cent from July 1, while the country would introduce a 10 per cent flat tax rate on personal incomes, the draft budget for next year said, as quoted by investor.bg on October 29.

The draft Budget 2008 was discussed on October 29 by representatives of the Government, trade unions and employers, within the so-called National Council for Tripartite Co-operation. The council agreed that the minimum monthly wage in Bulgaria should be raised by more than 22 per cent to 240 leva, from the current 180 leva.

Pensions in Bulgaria would seen an increase of 9.5 per cent from July 1 2008, thus reaching an average level of 196.40 leva for the country. The minimum pension would be upped from the current 102.85 leva to 112.62 leva, or by 9.5 per cent. The maximum size of the pension, paid by the National Social Security Institute would remain at 490 leva, or 35 per cent of the minimum secured income for the previous year.

A flat rate of 10 per cent would be introduced next year on all personal incomes, regardless of their size, and the currently existing threshold for non-levied incomes would be scrapped. As long as small businesses were also among the scope of the physical persons’ tax legislation, they would be the only ones for which a single rate of 15 per cent would be applied, investor.bg said.

Social security contributions next year would be paid 60 per cent by the employer and 40 per cent by the employee.