Net revenue from TV advertising in Hungary increased by 10% to reach HUF50bn (€164mn) in 2014, a survey by programming association MEME and Ernst & Young suggested on February 20.
The increase is the first for the past five years, MEME chairman Krisztian Kovacs said. Advertising revenue of terrestrial broadcasters, which accounts for 64% of the total, stagnated last year, but revenue from other sources climbed 28%, MTI reported.
The revenue growth comes amidst Budapest's controversial tax on media, which is based on revenue from advertising. The government the progressive tax last year.
The 50% levy imposed on the top band of companies with annual advertising revenue of more than HUF20bn applies only to German-owned RTL Klub, the country’s most popular TV station, which has been heavily critical of Viktor Orban’s government. However, media companies across the spectrum complained, noting that the tax is not waged against profit.
However, as the approval ratings of the ruling Fidesz plunged in recent months, the government reportedly sought peace with RTL in a behind-the-scenes deal agreed in January. Reports claim the government offered to cut the ad tax in return for less critical news coverage.
The government now looks set to adapt the levy to a flat rate, which however, will place greater stress on smaller players.
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