Fidesz to propose free-withdrawal legislation

In Hungary

The ruling Fidesz-KDNP has once again flexed its muscle of constitutional majority with another populist move, upping a previously-discussed amendment proposal to allowing all Hungarian customers two free cash withdrawals of up to HUF 150,000 from personal bank accounts per month.

 Along with the free-withdrawal regulation, the proposed bill agreed upon by Fidesz MPs and the National Economy Ministry will also exempt bank card payments from a tax on financial transactions. However, news outlet Portfolio.hu notes a gap between the two measures: “Whereas the costs of the first – several tens of billions of forints – will be borne by the banking sector, the approximately HUF 5 billion annual loss to be caused by the latter will be shouldered by the state budget.”

Portfolio had previously noted in earlier calculations that banks could stand to loss HUF 40 billion per year, thanks to the 0.6% financial transaction fee on cash withdrawals to their customers

The possibility of such a law coming to parliament was first announced in September, when Fidesz parliamentary party leader Antal Rogán governing stated at that time that the coalition’s plan called for Hungarians to receive at least one withdrawal from their bank accounts free of charge every month. The issue was raised, Rogan explained, due to the fact that essentially all the banks raised handling fees in response to the government’s introduction of a tax on financial transactions.

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