Varga: Personal income tax to stay as is

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Although Prime Minister Viktor Orbán expressed hopes of lowering the personal income tax to a single digit figure just a few weeks earlier, National Economy Minister Mihály Varga said in an interview that personal tax rate will not go below 10%, Hungarian news weekly HVG reported on its website today.

The minister explained that such a tax cut would create a budgetary deficit of HUF 500 bln, which is too much for the central budget at this point. He added that the rate of value added tax would not be decreased, for the same reason.

Reflecting on the FX loan law, Varga said the conversion of Hungarian borrowers' big stock of foreign currency-denominated loans into forints is expected to take place in 2015. The legislation on the exact amount of remuneration that borrowers would receive under the FX law is to be submitted by the end of November or early in December, Varga said. He explained that the effected parties should have a clear idea by the end of 2014 of the conditions and settlement of the conversion, the minister said.

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