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Népszava: RTL will drop criticism, gov't agrees to cut ad tax

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Cabinet Chief János Lázár yesterday agreed with Andreas Rudas, regional vice-president of RTL Group, that RTL's Hungarian station RTL Klub will soften its criticism of the government in their news show and, in repayment, Hungary's advertisement tax will be capped at 5.3% of revenues, online daily Népszava reported today, citing an unnamed source.

The advertising tax, established in June and apparently aimed at RTL Klub, is currently capped at 50% for those in the top bracket. RTL Klub is the only media outlet in that top bracket. An informant from the Berlin meeting between Lázár and Rudas reportedly told Népszava that the cut in taxes will be made in exchange for better coverage of the government, and that the proposed amendment to the ad tax has already been sent to the legal office of RTL Klub.

Another online daily, nol.hu, reported that their source said the government suggested that, if current RTL Klub CEO Dirk Gerkens leaves the local station, the top ad tax bracket would be reduced to 5%.

Accordng to Népszava's informant, Rudas will attend the weekly meeting of RTL Klub's news team in Budapest on Monday, in order to discuss the consequences of his pact with Lázár.

Népszava's informant said the government is also abolishing a restriction that prevents TV channels from collecting program fees from TV service providers, a measure that has reportedly cost RTL Klub HUF 6-8 bln in revenue.

Népszava reported that Lázár arrived at the negotiations possessing confidential documents regarding the business life of Rudas, thereby putting pressure on the German businessman.

The government has been openly hostile toward RTL Klub, and the tax was widely seen as a way to silence, or punish a critical voice. Since the tax was levied, RTL Klub has increased its negative coverage of the government, and enjoyed a massive growth in viewership of its news programs.

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