Municipalities have requested that a portion of income tax remain with them

A portion of the revenue from personal income tax should remain with the municipalities; the practice of the central government assigning tasks to them without securing funding should be discontinued; and new mechanisms for distributing transfers to local authorities should be introduced. These are among the main demands of the National Association of Municipalities in the Republic of Bulgaria (NAMRB), put forward as part of the ongoing debate on a new model of financial decentralization.

The ministry’s press office said the proposals were discussed at a working meeting at the Ministry of Regional Development regarding the draft of the so-called “Green Paper on Decentralization and Multi-Level Governance in the Republic of Bulgaria.”

NSORB also insists that the Council on Decentralization of State Administration be reinstated and its coordinating role restored. Regional Minister Ivan Shishkov stated that the government will work toward greater autonomy for local authorities and a change in the relationship between the state and the municipalities.

What lies ahead in terms of future policy and relations with municipalities is not simply decentralization, but a change in the nature of the state’s partnership with them,” Shishkov commented.

The preparation of the “Green Paper” comes as the deadline for implementing the current Decentralization Strategy expires at the end of 2025. The document was developed by the National Center for Territorial Development and is intended to assess the state of decentralization in Bulgaria, as well as to outline the main challenges, trends and possible future changes.

According to the Ministry of Regional Development and Public Works (MRDPW), the results of the discussions should serve as a basis for subsequent policy decisions, legislative initiatives and institutional reforms.

Effective decentralization is also included in the government’s governance program for the period 2026 - 2030, noted Deputy Minister Polya Zaneva. She stated that the proposals and comments made on the draft will be incorporated into the final version of the document.

Municipalities Want More Predictability

Daniel Panov, Chair of the Governing Council of the National Association of Municipalities in the Republic of Bulgaria (NAMRB) and mayor of Veliko Tarnovo, described decentralization as a long-standing priority for local authorities. According to him the reform could give municipalities more opportunities for planning and faster implementation of local policies. Financial decentralization in particular remains one of the most sensitive issues in relations between the state and local authorities.

Shishkov stated that municipalities can count on a more active partnership with the central government. He said that as part of the “Regions Speak” initiative meetings are planned in all regions of the country to discuss local issues and needs.

Translated with DeepL.