Hungary’s PM reiterates plans to lower personal income tax to single digit, govt to keep sectoral taxes
Hungary's Prime Minister Viktor Orban has reiterated his plans to lower the personal income tax rate from 16% at present to below 10% by the end of his government's term in 2018, portfolio.hu reported, citing Orban as saying in an interview for public radio MR1. This goal could be achieved if the country’s economic growth reaches 4-6%.
We note that the current Hungarian government applied a flat 16% personal income tax rate, when it first came to power in 2010, halving the highest 32% progressive rate.
Lowering the personal income tax rate to 9% would cut budget revenues by 44%, or by HUF 522bn (EUR 1.75bn) annually based on 2011 data, portfolio.hu reported last November, citing an analysis published in the Public Finance Quarterly.
Meanwhile, Orban noted that the government remains committed to special taxes, imposed on financial, energy, retail and telecommunications sectors. The PM also motivated the introduction of a special tax on the advertisement sector with the principal of fair sharing of public burdens.
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