Deputy Prime Minister Atanas Pekanov recently put the question in a form most Bulgarians will recognize from their own experience, saying it is not normal for him to sit in a restaurant in Vienna and one in Sofia and find the prices relatively the same when the standard of living is completely different. The restaurant associations answered that comparing Vienna and Sofia without also comparing tax burden, purchasing power, labor costs, rents, energy, supplies and the administrative environment is not economic analysis but convenient political talk, and that the first step toward lower prices would be a reduced VAT rate for the sector.
The truth is that Bulgarian restaurants are still the cheapest in the European Union, so the Vienna comparison does not hold. But their prices are rising more than twice as fast as the euro area average, and the main reason is not the euro at all.
The level and the trajectory are different questions
The price level index for restaurants and hotels, calculated through the purchasing power parity program on the basis of price surveys covering more than 2,000 goods and services across 36 countries, placed Bulgaria at 53 percent of the EU average in 2024. That was the lowest figure in the Union, in the category with the second-largest price dispersion across member states, against Denmark at 148 percent. For household consumption overall, Bulgaria remained the cheapest EU country in 2025 at 63 percent of the average.
