Bulgaria’s tax on Russian gas sparks diplomatic tensions

Bulgaria’s government has defended its decision to impose a new tax on Russian gas transiting through the country.

Hungary and Serbia, however which are dependent on Russian gas called it a “hostile” step, Radio Free Europe reported.

Bulgaria imposed a tax on Russian gas transit in the amount of 20 leva per megawatt-hour last week, prompting reactions in Budapest and Belgrade, which receive Russian gas through Bulgaria.

Bulgarian Prime Minister Nikolay Denkov defended the move on Wednesday, saying that the gas would „create real competition” on the gas market “from which the whole of Europe would benefit.”

“We protect Bulgarian interests,” he added.

Bulgarian Finance Minister Asen Vasilev said the goal of the tax was not to make gas more expensive for consumers in Hungary and Serbia but to make it less profitable for the Russian state energy company Gazprom to ship gas via Bulgaria.

Russia stopped supplying gas to Bulgaria soon after the start of Moscow’s full-scale invasion of Ukraine in February 2022 after Sofia refused to pay in rubles, which was a condition imposed on “unfriendly countries” as a way to sidestep Western financial sanctions against Russia’s central bank.

However, Sofia allowed Russian energy giant Gazprom to continue using its gas pipeline network to supply Serbia and Hungary, two of Europe’s most pro-Russian governments.

“Bulgaria’s decision to introduce a tax on Russian gas, which is delivered through its territory, is a step directed against Hungary and Serbia,” Serbian Deputy Prime Minister Sinisa Mali and Hungarian Foreign Minister Peter Szijjarto said in a joint statement on October 17.

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