Veres: price subsidies spending to drop Ft 150 bln or 20% next year
Hungary's budget correction would not be possible without increasing the tax burden, Finance Minister János Veres said on Thursday.
He added that the amount to be spent on price subsidies will be reduced by Ft 150 billion (€583.7 million) to Ft 600 billion next year as a result of legislative and regulatory amendments. Speaking at a tax conference organized by KPMG, the finance minister said that this year's modified 10.1%-of-GDP general government deficit will be 3.3% lower next year, of which 2.1% will come from expenditure cuts and 1.2% from increased revenues. Veres added that the deficit will be reduced by a further 2.5% in 2008, which will be entirely the result of expenditure cuts.
The budget targets spending of Ft 750 billion on price subsidies in 2006. Amendments already approved, primarily those concerning medicine and gas price subsidies, will reduce price subsidy expenditures by Ft 150 billion next year, according to the finance minister. In response to a question, Veres commented that gas prices will be based on market prices next year, while subsidies will be based on social factors, thus reducing the total amount of gas price subsidies to Ft 112 billion in 2007. (Mti-Eco)
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.