Post by radovic on Nov 15, 2007 10:44:55 GMT -5
US Diplomat Criticizes Bulgaria Over Gambling Tax
14 11 2007 Sofia _ Bulgaria’s budget for 2008 shows evidence of political protection for shady businesspeople, US Ambassador John Beyrle said in a interview on local TV channel bTV Wednesday morning.
“Who profits from this?” the diplomat asked, referring to a decision by the government on November 8 to reduce the basis on which taxes are calculated in the gambling sector.
Some national media have suggested that the only winners from this will be the two local versions of the state lottery, and the private enterprises Eurofootball and Eurochance.
The changes are designed to increase the two state lotteries’ market competitiveness, Deputy Finance Minister Kiril Zhelev was quoted as saying last week.
“We have focused on protecting our taxpayers and the actual income in the budget,” local media reported Zhelev as saying. He added that there was no question of the government trying “to satisfy any individual or corporate interests.”
Some Bulgarian politicians, however, including some from the ruling coalition, have criticized the government initiative, and the US ambassador has now joined the critics.
Pointing to another flaw in official tax policy – toleration of border duty-free shops which are unregulated and in consequence responsible for substantial losses to the state budget – Beyrle questioned the government’s priorities.
“What is more important to your society? Several well protected businessmen profiting by hundreds of millions a year from sales in the grey economy, or regaining the lost revenue and investing in better education or healthcare,” Beyrle asked.
“Changes in tax policy need to be backed by serious arguments and estimations,” Petur Ganev, an analyst at the Institute for Market Economics in Sofia, told Balkan Insight. “I don’t think that was the case with reducing the taxes on gambling.”
Ganev said the explanation that the changes are designed to make the state lottery economically viable do not really stand up to scrutiny.
“Another interesting question is why Bulgaria needs a lottery at all,” he said.
14 11 2007 Sofia _ Bulgaria’s budget for 2008 shows evidence of political protection for shady businesspeople, US Ambassador John Beyrle said in a interview on local TV channel bTV Wednesday morning.
“Who profits from this?” the diplomat asked, referring to a decision by the government on November 8 to reduce the basis on which taxes are calculated in the gambling sector.
Some national media have suggested that the only winners from this will be the two local versions of the state lottery, and the private enterprises Eurofootball and Eurochance.
The changes are designed to increase the two state lotteries’ market competitiveness, Deputy Finance Minister Kiril Zhelev was quoted as saying last week.
“We have focused on protecting our taxpayers and the actual income in the budget,” local media reported Zhelev as saying. He added that there was no question of the government trying “to satisfy any individual or corporate interests.”
Some Bulgarian politicians, however, including some from the ruling coalition, have criticized the government initiative, and the US ambassador has now joined the critics.
Pointing to another flaw in official tax policy – toleration of border duty-free shops which are unregulated and in consequence responsible for substantial losses to the state budget – Beyrle questioned the government’s priorities.
“What is more important to your society? Several well protected businessmen profiting by hundreds of millions a year from sales in the grey economy, or regaining the lost revenue and investing in better education or healthcare,” Beyrle asked.
“Changes in tax policy need to be backed by serious arguments and estimations,” Petur Ganev, an analyst at the Institute for Market Economics in Sofia, told Balkan Insight. “I don’t think that was the case with reducing the taxes on gambling.”
Ganev said the explanation that the changes are designed to make the state lottery economically viable do not really stand up to scrutiny.
“Another interesting question is why Bulgaria needs a lottery at all,” he said.