After a delay of almost four months, in view of the complicated political situation in the country, the State Budget of the Republic of Bulgaria for 2025 Act (the “State Budget Act”) adopted by the National Assembly on 21st March 2025, has been promulgated by virtue of Presidential Decree No 53.
Issue No. 264/28.02.2025 of our Legal Digest included an analysis of the most important aspects of the draft State Budget Act submitted to the National Assembly on 24.02.2025. However, some figures and provisions were amended in the course of its voting in the National Assembly.
In the meantime, the Budget of the State Social Security Act (“BSSSA”) for 2025 has entered into force, which further develops and supplements the State Budget Act in the part related to the public insurance bodies, social security contributions, receiving pensions, etc.
Some of the most important issues regulated in the State Budget Act and the related BSSSA are, as follows:
1. The amount of the national threshold for registration under the VAT Act is reduced from BGN 166 000 (approx. EUR 83,000) to BGN 100 000 (approx. EUR 50,000) as of 01.04.2025. The amendment clearly indicates the legislator's willingness to add more persons within the scope of the VAT law and to increase the amount of public receivables.
2. The minimum and maximum social security income is increased, again starting from 01.04.2025, which is essential for employers.
Specifically, for persons engaged under employment relations, the minimum insurance income for the period 01.04.2025 - 31.12.2025 is determined in accordance with the type of economic activity and their position, as per a special Appendix to the State Budget Act. However, irrespective of the economic sector and the type of profession exercised, this threshold may not fall below BGN 1 077 (approx. EUR 540).
For self-employed persons, the minimum monthly amount of insurance income until the end of the calendar year is firmly fixed at BGN 1 077 and the maximum at BGN 4 130 (approx. EUR 2,070).
3. A deficit in the budget balance of BGN 7.1 billion, or 3% of GDP, is foreseen, whereby this percentage is expected to decrease in the coming years.
On the other hand, the maximum amount of new public debt that can be incurred during the year under the Public Debt Act is fixed at BGN 18.9 billion. Respectively, the maximum amount of public debt at the end of 2025 cannot exceed a total of BGN 61.7 billion, in view of the commitments already made.
4. The minimum fiscal reserve may not fall below BGN 4.5 billion as of 31 December 2025. This value is maintained at the same level as envisaged in the state budget of the previous year (2024) and although there is no tendency for increase, some stability in the financial policy is still guaranteed.
5. No change in the tax rates is foreseen, which makes Bulgaria an attractive destination for potential investors.
6. The budget proposes a new excise duty calendar for tobacco and tobacco products, with rates increasing progressively on an annual basis. This is a financial aspect that companies in this sector will undoubtedly have to take into account when drawing up their budgets for the coming years.
7. Regarding social security and health insurance contributions - the amounts of social/health security contributions for all funds are maintained, as well as the ratios between insurers and insured persons.
As of 01.07.2025 the minimum pension for social security service and age shall be increased to the amount of BGN 630,50 (approx. EUR 315). Although the increase is not drastic against the background of the inflation index in the country, it is still a step forward in the direction of improving the lives of pensioners in the country.
In case a person is entitled to receive several pensions at the same time, on different legal grounds, their maximum total amount cannot exceed 3 400 BGN (without supplements) (approx. EUR 1,700).
