Economy
Hungary ex-PM accuses gov't of tampering budget figures
Doing the same things, only worse.
“If you consider how many people the state can support and how many people are needed to keep the country well organised and operable, only half of current MPs should do," Viktor Orbán told news portal index.hu. He said local governments should also be operated with half of their current staff and that the budget of parliamentary parties would also need to be reduced. Orbán suggested rethinking responsibilities instead of embarking on massive lay-offs.
“If we want to solve current problems by reducing headcount while keeping responsibilities unchanged, then we would have fewer people doing the same things, only worse," he said.
Government failed, drastic tax cuts are a must
“The economic policy that government has been pursuing in the past three years has failed and the economy is in such a bad condition that the situation cannot be remedied without swift and radical measures," he added.
“The worse the situation is, the bigger the tax cuts must be," Orbán said, adding that 16-32% of the Hungarian economy is outside the tax system. “By radical tax reductions, half of the grey economy could be brought within legal boundaries," he added.
The government is to reduce the top value added tax rate to 20% from 25% and the top personal income tax rate to 36% from 38% next year. The bottom PIT rate, however, will be kept on 18% but the income limit will be raised to HUF 1,550,000 from HUF 1,500,000. Orbán said that this was not enough, proposing to reduce the lowest PIT rate by 5% to 13%.
“Prices will not go down just because VAT is reduced to 21% from 25%. Analysts have also said this clearly. If this money was spent on reducing personal income tax or cutting the profit tax of small- and medium-sized enterprises to 8% from 16%, the result would be economic growth," Orbán added.
