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Net assets to be used in calculation of financial-sector tax for banks

The extraordinary financial-sector tax to be introduced by the new Hungarian government will be calculated based on net assets in the case of banks, the business daily Világgazdaság reported, citing unnamed sources.

The newspaper noted that such a tax base would disfavor the big banks. Seven banks -- OTP, K&H Bank, MKB, CIB, Erste, Raiffeisen and Unicredit - account for around four fifth of the combined total assets of the Hungarian banking sector.

Világgazdaság noted that the branches of foreign banks operating in Hungary would also be subject to the tax.

The newspaper said that the financial-sector tax on insurance companies will be calculated based on a combination of the local business tax and corrected premium revenue, while that on fund and asset managers would be based on the value of managed funds and assets. The government expects insurance companies to pay HUF 36 billion of the tax and fund and assets managers to pay HUF 2.2 billion.

The daily was informed that the European Banking Fedaration expressed concern over the tax in a letter sent to the Hungarian Prime Minister earlier this week.

Prime Minister Viktor Orbán announced on June 8 that the government would introduce a three-year extraordinary financial-sector tax expected to generate revenue of HUF 200 billion in 2010. (MTI – Econews)