Gov't may introduce property tax

Prime Minister Ferenc Gyurcsány's government is sticking to its plan to cut the country's budget deficit and may adopt a property tax. “I don't see a chance for softening,” Veres said at a press conference in Budapest today. “It is very important for this series of measures to work.” Gyurcsány last month unveiled plans to raise taxes, increase regulated prices and cut the size of government bureaucracy to reduce the European Union's largest budget deficit. The proposals, which face a parliamentary vote today, are designed to help slash the country's shortfall to a third by 2008 to qualify for euro adoption two years later. Trade unions have protested the measures, and staged demonstrations over the weekend urging the government to revoke some of the planned measures. Veres said while the government won't give up its budget goals, it's open to negotiations to fine-tune the plan. Hungary won't need to propose new tax measures this year to reach its budget goal, Veres said. The only possible proposal may be the introduction of a new property tax from 2008, he said. They are not planning to introduce anymore tax packages this fall for 2007. This year’s cuts would sum up about Ft 170 billion, this amount would reach Ft 500 billion next year. This year government increases its incomes 50% and reduces spendings 50%, next year these rates would be 60% and 40%.(Bloomberg, MTI)