Gov't to Cap Electricity Prices for Some Sectors

To reciprocate the measure, the government expects those businesses to boost capacity and pledge not to raise prices for the rest of the year, Gulyás said. The Hungarian Chamber of Commerce and Industry (MKIK) will ensure compliance, he added.

The measure will support over 5,000 businesses and add HUF 40 bln to fiscal expenditures, he said.

Gulyás also announced two more measures included in an economic protection plan the government is rolling out. From August 1 until the end of the year, the government will allow Szép voucher card balances to be used for purchases of food in supermarkets. It will also raise the annual threshold for employer Szép card top-ups with tax preferences from HUF 450,000 by a further HUF 200,000.

The government decided to allow pharmaceutical companies to write off up to half of their 40% windfall profit tax with spending on investments or R&D from July 1.

Addressing the matter of the transfer of Hungary's European Union funding, Gulyás said that "the ball is in Brussels' court". Whether or not the European Commission will accept a conflict with the European Parliament and give Hungary its EU funding is a "political decision", he added.

The EC has confirmed Hungary has complied with the last "milestone" required to access its EU funding, he said. In principle, Hungary can start sending invoices to Brussels from July 1, after which time the body has 90 days to take a decision on transferring the money, he added.

Gulyás affirmed that a 13% contribution the government is levying on earned interest, with an exemption for returns on government securities, is a temporary measure in force only until the end of the war in Ukraine.