Boyko Borisov (Bulgaria’s relatively new Prime Minister and rakia fan) will be the most popular person in Bulgaria with this news on rakia and duty. However the loophole is closing in with the monster EU in the wings just waiting to close the rakia tax free loophole up completely. This however would still not prevent Bulgarians making home made rakia in the sly, that's how it is here.
Bulgaria's new government abandoned plans to raise alcohol taxes due to public anger that this would threaten a centuries-old tradition of making wine and rakia brandy at home.
The centre-right government of the GERB party, which won July general elections, had hoped to raise an extra 60 million levs ($45 million) a year for the health and pension systems with the increase, which would have been imposed in 2010.
But Prime Minister Boiko Borisov backpedalled on the plan following the rising discontent among Bulgarians. "In order not to affect the average villager ... we will not raise the excise duty on alcohol," local media quoted him as saying on Sunday.
Bulgarian families are allowed to produce only 30 litres a year of rakia, a traditional grape brandy, without paying tax. Industry officials had also criticised the plan, saying it would boost alcohol smuggling and illegal production.
Last week, Finance Minister Simeon Djankov said he wanted to raise the excise duty on alcohol by 15 percent to boost budget revenues, badly needed for funding the health care system and pension payments.
However, Borisov backed plans to raise duties on cigarettes by 43 percent next year in an attempt to curb smoking and relieve the health care system. Bulgaria ranks second after Greece in the EU in terms of number of regular smokers as a percentage of the population.
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