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Hungary's Veres sees no „substantial” tax changes through 2009

Hungary's government will hold off on major changes to its tax system through 2009 while it discusses proposals with business leaders and social partners, Finance Minister János Veres said.

„The first realistic date for substantial changes in the tax system is January 1, 2009,” Veres said today during a press conference in Budapest. „We are expecting these discussions to uncover the real opportunities that will allow us to move forward relatively quickly.” Prime Minister Ferenc Gyurcsány's government has introduced new taxes and raised others since June last year to cut the budget deficit after running up the European Union's widest shortfall last year. The premier on February 15 said a new property tax, which the government plans to add next year, won't bring extra income to the budget because it will replace other sources of revenue. Other tax changes, later on, will also be neutral to the budget, with a redistribution between income-type taxes and consumption-type taxes. Hungary, which has missed its budget deficit target every year since 2001, wants to cut the shortfall to 3.2% of GDP by 2009 from about 9.6% last year. This year's goal is 6.8%, and next year's is 4.3%. (Bloomberg)