July brings sweeping changes all around

In Hungary

A whole barrage of new measures, regulations and the launch of controversial systems in commerce and transportation took effect on July 1. Smokers have had to start scouting their neighborhoods for places to buy cigarettes, while truckers now have to reach deeper into their pockets, and that isn’t the end of it by far.

Those on vacation in the middle of summer will find a broad range of altered circumstances to get used to when they return.

The legal system underwent changes that particularly affect the users of various substances, legal and illegal alike. The amendments to the criminal code introduce far stricter penalties for drug consumption, but the new stringency also applies to alcohol, so that motorists caught with even the slightest amount of booze in their system should expect to face serious repercussions.

The government is making good on an earlier promise to eliminate double earning, meaning people who have reached the age of retirement but are still working can pick up either their pensions or their salaries, but not both.

Smoke 'em if you can get ‘em

With the start of the month, passers-by can see throughout the country vaguely ominous looking, opaque window fronts with the words ‘Nemzeti dohánybolt’ plastered above them, accompanied by the number 18 in a red circle. These ‘trafiks’ are the only retail outlets now legally authorized to sell tobacco products, with all others having until July 14 to sell whatever they had stockpiled before the deadline.

The transition is far from fluent. By July 1, many new trafiks hadn’t yet opened, while others had, but had no stock. Accounts are spreading of other teething problems, some larger than others, like clerks at newly opened stores being completely unfamiliar with the brands they are selling, or of minors still being able to buy cigarettes, which was one of thee justifications for the change in the first place.

Criticism, including charges of corruption and incompetence leveled against the government, are far from fading, underlined by photos spreading on social media that show cases where two separate storeowners won licenses in the very same building literally meters from each other. Not to mention other cases where a trafik has opened right next to a fitness parlor, a youth recreational center, a school, or even in one case in place of a pharmacy.

Altogether, 5,300 applications were approved to practice the trade in tobacco products, along with alcoholic beverages and, somewhat incongruously, ice cream. The authorized product range was expanded so that license winners are assured a guaranteed percentage of profitability. Some 60 established kiosk operators have received grace period until the end of year in localities where no license winners were declared or no applications were submitted.

Hauling for a price

The start of July also saw the launch of the electronic road toll system for cargo vehicles. The system dubbed HU-GO affects all vehicles weighing 3.5 tons or more along Hungary’s 6,513-kilometer road grid.

According to the Útdíj.hu information portal, freighters will now be required to register their vehicles to receive and install a suitable device to keep track of the distance they travel. Large shipping firms can expect substantial cost increases.

Hungary’s market leader, Waberer’s, is projecting annual additional expenses of HUF 4 billion as a result of the new system as the company’s deputy CEO Ferenc Lajkó told thematic portal Útdíjhírek.hu. He stated that freight firms will have no option but pay up, since there is little to no way to find alternative routes, especially considering that prospective detours (i.e. the main streets of smaller townships) have a ban on large vehicles.

The Economy Ministry had projected HUF 75 bln in revenues this year from the new toll regime. However, thanks to later revisions to the law with the aim of supporting Hungarian freighters, the amount is now expected to be HUF 15 bln less.

Cheaper utilities

July marks the second wave of the government’s sweeping campaign to reduce utility costs for households, introducing yet another 10% mandatory reduction. This time, the centrally dictated discount affects sewage removal, chimney cleaning, sewer fees and garbage disposal. As a result of common European Union regulation, roaming charges will also be reduced.

The government went ahead and introduced the reduction despite industry calls for reconsideration. For instance, the association of chimney sweeps warned that the price reduction would lead to smaller businesses folding, resulting in a shortage of professionals.

The situation is set to culminate for the winter season, where many homes with outdated heating systems could remain uninspected, thereby endangering the health or even lives of the residents.

Nonetheless, Prime Minister Viktor Orbán reiterated in his latest appearance before the European Parliament in Strasbourg that not only will the government insist on preserving the established price levels, but is also determined to go through with yet another wave of cuts in the fall.

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