Gyurcsány, tax, would resign?

Banking

If the parliament does not accept the new tax and budget laws, he will resign, said Prime Minister Ferenc Gyurcsány in an interview to the public radio channel Kossuth Rádió, after he published his tax proposals in a paid advertisement in the daily Népszabadság.

The essence of the whole program is that it should be cheaper to employ people; he summarized the 6-page supplement of the daily. Much of the money that would offset lost budget revenue resulting from the Ft 300 billion tax cut would come by pulling the purse strings tighter, Gyurcsány said at a press conference, also on Wednesday.

However, Hungary must not veer off the convergence program and must not reduce welfare spending. A tighter budget policy would cover Ft 170 billion to Ft 180 billion. Ft 110 billion to Ft 120 billion in additional income could come from the tightening of some tax rules next year (e.g. changes in the accounting of company cars, levying 11% health tax on untaxed in-kind payment, and an increase in the excise tax on alcohol and tobacco). Ft 50 billion would be covered by a crackdown on the shadow economy.

Although the Ft 1,000 billion budget revenue currently lost in the grey and black economy could cover the proposed tax reductions over the course of the multi-year program, the first step must be financed, he said. Tax experts say that relying on additional revenue from turning people into honest taxpayers is a risky prospect, especially in the short term. (Gazdasági Rádió, Mti-Eco)

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