Банкеръ Weekly

Briefs

ENVIRONMENT MINISTRY PROJECTS FEES HIKE

The five organisations, licensed to use packaging waste, were discontented with the statement of Minister of Environment and Waters Dzhevdet Chakarov that they were not collecting sufficient money from their operation. At the Tuesday (January 9) briefing in the Ministry of Environment and Waters it was said that the expected proceeds from product fees which these organisations should remit to the ministry's budget for 2006 amount to BGN274,728,000. The reason for the criticism towards Bulecopack, Ecobulpack, Repack, Recopack and Ecopack is that collectability in 2005 reached just 30% of the expected BGN217,820,000 in proceeds from product fees. Therefore, the Enterprise for Management of Environmental Protection Activities received only about BGN11MN. The inability to collect the money from taxes is already becoming a tendency. In 2004, for instance, only BGN19MN was gathered, instead of the expected BGN113MN-plus, the environment ministry specified. Experts explained that the money that goes to the Enterprise for Management of Environmental Protection is spent by the State for implementation of projects for processing and utilization of wastes, e.g. introduction of separate collection of packs, construction of waste dumps for household garbage, etc. Projects for the introduction of separate collection of garbage, worth BGN6,504,170, have been approved so far. Five municipalities - Karlovo, Kyustendil, Varna, Troyan, Rousse, and Dobrich - are pioneers in that labour-consuming and expensive operation. However, positive results are hardly visible for the time being.
An audit at the five above-mentioned organisations has established that some companies are prompt payers of the product fee, but there are also others which in their capacity of importers and producers calculate only a token fee, called a licence fee. A number of firms do not even pay such a fee. The environment ministry wants the five organisations to use their financial resources for recycling and utilization of a percentage of the packed goods, released on the market by their members. In business circles this has been interpreted as an intention of the state officials to hike the licensing fees which the organisations pay now. On the order of Mr. Chakarov his ministry is launching a campaign for collecting the overdue product fees. For a consecutive time he threatened to impose measures, intended to achieve full collectability of fees and strict control on their use.
The Wastes Management Act, approved in September 2003 and enforced as of the beginning of 2004, projects that Bulgaria will recycle 34% of the waste packs and utilize 35% of them. Under Bulgaria's commitments to the European Union (EU), recycled wastes should reach 80% in 2014, and utilization should be 60 per cent.
Representatives of the five collective organisations, licensed to use packaging waste, answered to the environment ministry's criticism that they were not allowed to form a profit, depriving them of the opportunity to attract investors. They warned that a hike of their licensing fees would result in a price increase of the basic foodstuffs. Thus, the final price will be again at the expense of the end consumer.

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