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Gov’t looking for further industries to tax

According to reports, Hungary’s government is looking at the energy and infocommunications industries to introduce a similar extra tax that it is determined to impose on the finance sector.

The daily Népszabadság claims knowledge of government to generate extra revenues from profitable industries seeing that it is obliged by a pact with the International Monetary Fund (IMF) to force the budget deficit below 3% in 2011.

Several government officials have stated that the target is unrealistic. National Development Minister Tamás Fellegi said that without revising the original agreement, Hungary’s entire public transportation system would collapse.

The paper raised the issue in an interview with head of the IMF’s Budapest office, Iryna Ivaschenko. The official reiterated that the IMF does not approve of any ad hoc taxation measures since they only present a temporary solution.

It is for this very reason that the fund objects to the government’s finance sector tax, particularly the size of the amount it is hoped to generate and the manner in which it would be imposed, as it is seen as a hindrance to the overall economy.

Portfolio asked a number of government institutions whether there was any merit to the rumors. The National Economy Ministry said it “will not comment on offhand remark dropped in a newspaper”. (BBJ)