Hungary's government will submit next year's budget bill to parliament on September 30. Parliament will approve the bill on December 19-20 and the Budget Act will be published on December 28, according to the National Economy Ministry's budget schedule published on Monday.
Consultations among ministries regarding the 2012 budget will start on Tuesday and the government will approve the draft bill on August 31.
Hungary targets a 2.5% ESA95 general government deficit in 2012 under its convergence plan updated in the spring.
The ministry noted that the government's economic policy is based on a strong commitment to cutting state debt and reinstating budget equilibrium while fostering growth and competitiveness. Therefore, it is necessary to create the conditions and means in the 2012 Budget to protect Hungary's economy from the risks stemming from global developments.
The statement noted that reducing the deficit is also an obligation under Hungary's new constitution, which requires the government to reduce state debt until a limit of 50% of GDP is reached. The debt ratio currently stands at 77%.
The government expects the tax changes it introduced, the modernization of vocational training and the restructuring of higher education to raise Hungary's low employment rate. The reduction of the profit and personal income tax rates, an increased labor supply and the expected drop in risk spreads are expected to boost investments, as will the reduction of administrative burdens, the ministry said.