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FM expects tax revenues below target

Finance Minister Péter Oszkó said that Hungary's tax revenue will fall by HUF 900 billion (€3.22 billion) this year as compared to the autumn 2008 original budget plans, instead of a previously forecast shortfall of HUF 800 billion.

Hungary was forced to re-write the 2009 budget several times compared to original bill as growth prospects have deteriorated as a result of the global financial crisis and the recession. Oszkó said that the government will compensate for the fall in tax revenue throughout a HUF 1,000 billion cut in expenditures, thus the deficit will remain at or under 3.8% of GDP.

The finance minister said that the notion of raising employment amid a 5%-6% contraction in GDP is an illusion, adding that only the decline in employment can be moderated this year and in 2010. Oszkó said they used all potential to cut taxes on businesses to boost employment. He said that the government can consider revising local taxes only when Hungary's GDP begins to rise again. (MTI - Econews)