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PM announces new taxes, other changes

The government will not change the family support system, will continue adjusting pensions to cost of living and will keep pensioner benefits in place, Prime Minister Ferenc Gyurcsány said on Saturday.

Apart from a new 4% solidarity tax, to be levied on profitable businesses and individuals with an annual income of at least Ft 6 million (Euro 22,600) or more, there will not be any income tax hikes, PM Ferenc Gyurcsány said. Changes to the personal income tax system will include raising the ceiling on the lower 18-% tax bracket to Ft 1,700,000 (Euro 6,415) as of 2007, which the government calculated would put 73% of residents in this lower tax bracket. The aim is to increase that rate to 90% of taxpayers, Gyurcsány said.