Economy
Hungary may phase out bank tax completely next year - Orbán
“As far as I can see, from 1 January 2013, the bank tax will perhaps be removed from the tax system, not just moderately as agreed, but completely, and in its place will be the transaction tax," Orban told some 100 businessmen at an event organised by the Austrian Chamber of Commerce in Vienna on Tuesday.
Previously, the government planned to cut the bank tax to half next year and phase it out completely as of 2014.
The PM also said talks about the details will be held in the coming weeks and months.
The transaction tax is expected to generate gigantic revenues and if turns out that way the revenues will be spend exclusively to lower income and social taxes, i.e. to boost competitiveness, Orbán added.
He noted that the new levy is not a crisis management tool, but a permanent element in the future Hungarian economy. Responding to comments by Raiffeisen Bank International CEO Herbert Stepic, who told him the burden Hungary had imposed on banks was "unacceptable" and that the transactions tax could not add to banks' costs, Orbán acknowledged that the rate of the bank tax was indeed brutal and outstandingly high even in European terms.
In order to make the Hungarian economy competitive enough the country’s debt should be cut to below 50% of GDP, there should be at least five million taxpaying employees, a proportionate tax regime, no retirement before the statutory retirement age and a solution to the demographic problem, the PM said.
Banks were taken aback last month when the government approved budget plans for 2013, seeing that these included the introduction of a new financial transaction tax from which the cabinet wants to raise HUF 130 billion annually.
The chief of Hungary's Banking Association has called that plan a "slap in the face" and said the banks wanted to limit next year's tax burden to HUF 60 bn as agreed with the government in December.
Previously, the government planned to cut the bank tax to half next year and phase it out completely as of 2014.
The PM also said talks about the details will be held in the coming weeks and months.
The transaction tax is expected to generate gigantic revenues and if turns out that way the revenues will be spend exclusively to lower income and social taxes, i.e. to boost competitiveness, Orbán added.
He noted that the new levy is not a crisis management tool, but a permanent element in the future Hungarian economy. Responding to comments by Raiffeisen Bank International CEO Herbert Stepic, who told him the burden Hungary had imposed on banks was "unacceptable" and that the transactions tax could not add to banks' costs, Orbán acknowledged that the rate of the bank tax was indeed brutal and outstandingly high even in European terms.
In order to make the Hungarian economy competitive enough the country’s debt should be cut to below 50% of GDP, there should be at least five million taxpaying employees, a proportionate tax regime, no retirement before the statutory retirement age and a solution to the demographic problem, the PM said.
Banks were taken aback last month when the government approved budget plans for 2013, seeing that these included the introduction of a new financial transaction tax from which the cabinet wants to raise HUF 130 billion annually.
The chief of Hungary's Banking Association has called that plan a "slap in the face" and said the banks wanted to limit next year's tax burden to HUF 60 bn as agreed with the government in December.
