Magyar Telekom urges against plan for internet tax

Banking

The Hungarian government should revoke its plan to tax internet use from next year as it will be detrimental to service providers, internet users — individuals and companies alike — as well as to the public, Magyar Telekom said in a statement to The Wall Street Journal.

Under the 2015 tax bill submitted to parliament on Tuesday, the government plans to impose a HUF 150 per gigabyte tax on internet traffic on every gigabyte of data used. Magyar Telekom said the tax may result in the internet providers paying as much as HUF 100 bln a year in tax, which would make it impossible to develop broadband in Hungary and a modern economy built on the internet.

The government said it expects to colledt HUF 20 bln a year from the taxes, but other estimates are closer to the HUF 100 bln forseen by the telecoms company. "Magyar Telekom supports the proposition of the industry players that the government should revoke its plan to launch the tax," the company. The plan is "drastic" and wasn't preceded by any consultation with the sector, Magyar Telekom added according to The Wall Street Journal report.

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