Business Politics

Serbia, Hungary vow response to new Bulgarian gas transit tax

To the anger of Serbia and Hungary Bulgaria is holding firm on a new LEV 20 per cubic meter transit tax on gas from Russia, with Bulgaria stating that the goal is no make Russian gas less palatable for Hungary and Serbia, but to make it less profitable for Russia and to “create competition.”

“There is a good chance that this [tax] would create real competition” on the gas market “from which the whole of Europe would benefit,” said Bulgarian Prime Minister Nikolay Denkov Oct. 18, as cited by Radio Free Europe.

He added that revenue off the transit tax will “enter the Bulgarian budget.” The tax was enacted in late September.

Additionally, according to RFE, Bulgarian Finance Minister Asen Vasilev said the goal of the tax was not to make it less profitable for the Russian state energy company Gazprom to ship gas via Bulgaria.

Russia no longer supplies gas to Bulgaria, but gas is delivered through a transit pipeline to both Hungary and Serbia, which have been against EU and US sanctions since the beginning of the war in Ukraine. Noteworthy is that both are highly dependent on Russian gas.

Whether or not Bulgaria is acting intentionally against Serbia and Hungary, there is little doubt that both countries see it that way. In a press release issued by both Serbian Deputy Prime Minister Sinisa Mali and Hungarian Foreign Minister Peter Szijjarto both officials said that this tax acts directly to the detriment of both countries and that a joint response will be in order. Szijjarto has gone further to call the tax a “hostile move.”

Photo of Serbian Deputy Prime Minsiter Sinisa Mali by Skinjara, CC BY-SA 4.0 <>, via Wikimedia Commons.

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