Agreement on RRF funding hinges 'only on EC', Gulyás says

EU

Gergely Gulyás

Photo: Gergely Botár/kormany.hu

An agreement on Hungary's Recovery and Resilience Facility (RRF) funding now depends only on the European Commission, as the government has accepted the body's stand on disputed issues, Gergely Gulyás, the head of the Prime Minister's Office, said on public radio on Sunday, state news wire MTI reports.

In a letter sent to the EU's executive body, Gulyás said the government accepted the EC's position in all four areas in which it expected progress, "regardless of whether we agreed with the suggestions or not".

He added that the significance of the issues in question are "much smaller" than the matter of Hungary getting the funding to which it is entitled.

"As we've accepted the Commission's position on all of the issues over which there were differences so far, we think the only thing that remains to be discussed is the technical close, after which an agreement can be signed," he said.

Commenting on a European Parliament resolution on the global minimum corporate profit tax, Gulyás said the minimum global tax and the RRF have "nothing to do with each other", adding that the resolution was a "gross violation" of the EU Treaties as the principle of sincere cooperation does not allow correlations to be made between unrelated matters.

The global minimum corporate tax, in its present form, is good for the United States, but bad for Europe and even worse for Central Europe, he said. The adoption of the minimum tax rate would result in the loss of Hungary's tax advantage that has drawn international investors and their investments to the country, he added.

He said the United States' cancellation of its double taxation avoidance agreement with Hungary was "strong-arming" to get the country to approve the global minimum corporate tax. He added that the termination would not come into force until January 2024, leaving Hungary one-and-a-half years to approve the global minimum corporate tax.

The action is a "petty step by a superpower", he said.

Gulyás acknowledged the risk to the economy posed by higher prices for commodities and energy and said the government had done "everything in its power" to "normalize" the situation. The budget is stable and balanced, the deficit is falling and the real economy is in a good position, he added.

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