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Hungarian banks reject govt decision to keep bank tax

Telco

The Hungarian government's new measures to raise taxes on banks violate an earlier agreement signed with banks and hurt the economy, the Hungarian Banking Association (MBSz) said in a statement on Wednesday, right after that National Economy Minister György Matolcsy announced a HUF 367 billion austerity package.

"The measures announced by the government today - if passed by parliament - endanger predictable financing to economic players and all their elements reduce the lending ability of banks," MBSz said.

The country's economy minister said the government would not halve a windfall tax on the bank sector next year - contrary to earlier plans - and will raise the rate of a new tax on financial transactions.

The bank levy will not be halved from 2013, adding HUF 72 billion additional revenue to the budget, Matolcsy said. The government also decided to increase the scale of the financial transactions duty from 0.1% to 0.2%, bringing in HUF 90 billion more from banks, he said. The rate will also rise for the Treasury, generating an additional HUF 40 billion in revenue.

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