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Gov't plans could spur growth, help meet deficit target, say analysts

Planned government measures announced by the prime minister on Tuesday could spur growth and help Hungary achieve its 3.8%-of-GDP deficit target for 2010, analysts told MTI.

Raiffeisen Bank chief analyst Zoltán Török said the measures announced by Prime Minister Viktor Orbán in Parliament show a move in the right direction, strengthening the competitiveness of domestic companies and allowing the country to meet its deficit target for 2010. The measures serve to make the tax system more transparent and reduce tax evasion, he added.

Among the measures Orbán announced were ones cutting spending on budget-funded institutions, introducing a 16% flat-rate personal income tax, raising the ceiling on the base for a preferential 10% corporate tax rate, and introducing an extraordinary tax on banks.

K&H Bank chief analyst György Barcza said the cost savings resulting from the measures would reduce the some HUF 230 billion of risk in the 2010 budget. (MTI-Econews)