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Amendment would raise severance pay tax threshold to HUF 3.5m

An amendment to a bill submitted to Parliament by the accounting and budget committee on Monday would raise the threshold for a proposed 98% tax on severance pay for all but the most senior public sector workers from HUF 2 million to HUF 3.5 million.

The amendment was submitted after Fidesz fraction leader János Lázár met with public sector union heads. The threshold in the bill for the highest-level state employees remained at HUF 2 million.

Another change to the bill would make public sector employees taking early pension exempt from the tax.

If approved, the law would have retroactive effect from 2005 rather than from January 1 this year as stated in the original version of the bill.

Hungary's Constitutional Court recently ruled against a bill approved by Parliament introducing the tax and annulled it. The Fidesz fraction has since resubmitted the bill with minor changes. (MTI-ECONEWS)