European Commission: Bulgaria will decide where the revenues from the tax for the transfer of Russian gas on its territory will be directed

"The European Commission has been notified of Bulgaria's recent gas supply measures. We are in contact with Bulgaria and other affected countries to assess and discuss the possible repercussions of this measure," a spokesperson for the Community Executive said in response to questions related to the tax for the transfer of Russian gas through Bulgaria, writes Cristian Gerhasim.

According to a new law, published this month in the Official Gazette of Bulgaria and which entered into force immediately, a fee of 20 leva (€10) is introduced for each megawatt hour of gas coming from Russia. It is equivalent to approximately 20% of the reference price for natural gas at the Amsterdam Stock Exchange. Regarding the question of where the revenues from this tax will be directed, the answer was: "This is a national measure, the decision is the competence of the Sofia authorities."

The spokesperson specified that the EU sanctions approved so far foresee measures against coal and oil imports from Russia, and not for gas. The EU has set itself the goal of reducing dependence on fossil fuel imports from Russia as soon as possible, the official added.

Late last month, the Russian group Gazprom did not comment on the decision by the authorities in Sofia, but the Hungarian Minister of Foreign Affairs, Peter Szijjarto, whose country benefits from a large part of Russian natural gas passing through Bulgaria, criticized the decision as "unacceptable".

"For an EU member state to threaten another member state's gas supply is against European solidarity, the rules and is unacceptable," Szijjarto said. Bulgaria's new tax, which includes an exception for compressed gas transported in special containers, will apply to network operators and gas importers, but it is not yet clear how it will affect other market participants. The normative act is intended to implement the sanctions imposed on Russia by the European Union in response to the invasion of Ukraine.

Among the objectives of the law are "a fair taxation of the profits made on the territory of the state and the increase of revenues to the budget", according to the parliamentarians who drafted the normative act. Bulgaria, an EU and NATO member state, has strong cultural, historical, and language ties with Russia, although the Kremlin's war against Ukraine has caused major cracks in that support. Bulgaria’s ties to Russia go back a long way and have been often complicated.

This would further add to the confusion as Bulgaria has been moving away from Russia. Recently Bulgaria has agreed to provide the Ukrainian army with some 100 armored personnel carriers, marking a turnaround in the NATO member’s policy on sending military equipment to Kyiv following the appointment.

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