Hungary: Tax cut is not a magic tool

Banking

The government plans a tax cut from 2009, but the necessary reserves are only available for the first year, Prime Minister Ferenc Gyurcsány said in a lecture held at Budapest’s Corvinus University.

As further source of the tax cut coverage Gyurcsány suggested the bleaching of black and grey economy from 2010, because no more finances can be removed from the social subsidies system.

The government would cut taxes by Ft 1,000 billion in four years, which includes the decline of personal income tax as well as employers’ contributions, he said. But tax cuts are no magic tools, an increase of larger scare requires the change of education and social structures plus the business environment, Gyurcsány said. State expenditures can only be reduced in the medium run until 2012 by 3-5%.

The government will submit next year’s budget to Parliament in two weeks and the budget will calculate with a 3.2% budget deficit. It will be the first time since 1989 that the budget has a declining deficit even getting close to an election period, Gyurcsány highlighted. (Gazdasági Rádió)

ADVERTISEMENT

Századvég raises GDP forecast to 7.8% Analysis

Századvég raises GDP forecast to 7.8%

Opposition parties to begin PM candidate primaries Elections

Opposition parties to begin PM candidate primaries

New editor-in-chief at Betone Studio Appointments

New editor-in-chief at Betone Studio

Budapest leaders make public transport free for under-14s City

Budapest leaders make public transport free for under-14s

SUPPORT THE BUDAPEST BUSINESS JOURNAL

Producing journalism that is worthy of the name is a costly business. For 27 years, the publishers, editors and reporters of the Budapest Business Journal have striven to bring you business news that works, information that you can trust, that is factual, accurate and presented without fear or favor.
Newspaper organizations across the globe have struggled to find a business model that allows them to continue to excel, without compromising their ability to perform. Most recently, some have experimented with the idea of involving their most important stakeholders, their readers.
We would like to offer that same opportunity to our readers. We would like to invite you to help us deliver the quality business journalism you require. Hit our Support the BBJ button and you can choose the how much and how often you send us your contributions.