Hungary: Minimum wage earners the bane of growth
The 50% of GDP state redistribution rate should be lowered to 40% to speed up economic growth to 4-5%, said András Simor current and György Surányi former central bank governors.
Tax revenues are not sufficient as nearly 1.4 million people hardly pay any taxes being registered as minimum wage earners, said György Surányi. Finance Minister János Veres pointed out that Hungary spends 4% more on the social system and 2% more on budget debt interests than Slovakia, reminding that curbing welfare spending there was followed by hunger riots. According to the minister, reducing expenses can be possible through rationalizing the municipal system. Both the current and the former central bank heads said, that the need for adjustments was the result of irresponsible policies between 2001 and 2006. (Gazdasági Rádió)
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