Hungary telecom sector tax in line with EU laws, ministry says

Banking

Hungary does not intend to modify the act on the extraordinary telecommunication sector tax as the government's stance is that the tax does not contravene European Union law, the National Economy Ministry told MTI in a statement on Wednesday.

The statement is in response to the European Commission's request to Hungary on September 29 to abolish the tax the government has imposed on the country's telecom operators.

The European Commission has said the tax violates EU law because revenue from the tax are spent not on the special costs of the regulation of the telecom sector, but on central budget spending.

Hungary said it won't modify its law on sectoral tax because it is a direct tax and therefore comes under a member state's jurisdiction.

The ministry also said Hungary is ready to defend its stance in court.

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