Economy
Hungary cabinet chief threatens firms with higher taxes if they complain to EU
Hungary will not back down in fight with Brussels
“We are not planning to surrender to the European Commission with respect to the special taxes on the retail and tobacco industries," Lázár said.
There are two ways the cabinet can go, he added: it can either settle the issue via negotiation or it go up against the decision in court, because the Commission could not have made this call.
In the latest cases, Brussels said it was not disputing Budapest’s right to introduce taxes, but rather the steeply increasing rates that apply to larger, predominantly foreign companies, such as Philip Morris International, Imperial Tobacco and Spar, the Financial Times reported on Sunday.
The Commission has also issued an injunction to prevent the government from collecting the taxes. The EU executive said Hungary had provided no objective reason to discriminate between companies based on turnover. Brussels said in a statement it supported attempts to reduce tobacco consumption but it "had doubts that the effects of tobacco products on public health increase progressively with the turnover of companies selling them."
“Rest assured, these companies will pay more than the originally planned 40 billion forints. They will pay so much more that it will discourage them from reporting Hungary," Lázár responded to a question. He added that the higher burden can be expected in the new tax year.
Lázár told journalists last Thursday that it is Spar and Philip Morris are behind the two separate in-depth investigations the EC has launched into Hungary’s tax system.
"We can say to Spar and to Philip Morris that if you won’t pay this tax, then you’ll pay another, but one way or another, you’ll pay," the FT cited him as saying. "You can go complain to the EU, but then you’ll just pay more. And it’s going to be this way for every group that presses charges against a country where it wants to earn money," he added.
Migrants vs. Fence
Lázár warned that by the end of the day more than 90,000 illegal migrants will have crossed Hungary’s border since the start of 2015, and that by the end of the year their number could reach 200,000 to 250,000 but possibly even 300,000.
Under a recent decision the government will have a security fence built on the Hungarian-Serbian border within the shortest time possible, the minister said. Report have been about a November completion on the 175-kilometer stretch, but works will most likely accelerate now, he added. The fence will be dug 1.5-meter deep into the ground and reach 3 metres high, topped by NATO razor barbed wire with coil diameter of 50-70 centimetres. There will be two types of fences. One will be built on a cc. 40-km stretch of hardly accessible swamp areas and another on the remaining part. The cabinet expects the border fence to radically reduce the number of illegal border crossings in the country.
The government will use 980 square kilometres of private property to build its fence. It will pay a one-off compensation and a service fee of about HUF 160-170 per square metre. Land owners may turn to court if they are not satisfied by this deal but the construction will not be suspended by any complaint.
“We are not planning to surrender to the European Commission with respect to the special taxes on the retail and tobacco industries," Lázár said.
There are two ways the cabinet can go, he added: it can either settle the issue via negotiation or it go up against the decision in court, because the Commission could not have made this call.
In the latest cases, Brussels said it was not disputing Budapest’s right to introduce taxes, but rather the steeply increasing rates that apply to larger, predominantly foreign companies, such as Philip Morris International, Imperial Tobacco and Spar, the Financial Times reported on Sunday.
The Commission has also issued an injunction to prevent the government from collecting the taxes. The EU executive said Hungary had provided no objective reason to discriminate between companies based on turnover. Brussels said in a statement it supported attempts to reduce tobacco consumption but it "had doubts that the effects of tobacco products on public health increase progressively with the turnover of companies selling them."
“Rest assured, these companies will pay more than the originally planned 40 billion forints. They will pay so much more that it will discourage them from reporting Hungary," Lázár responded to a question. He added that the higher burden can be expected in the new tax year.
Lázár told journalists last Thursday that it is Spar and Philip Morris are behind the two separate in-depth investigations the EC has launched into Hungary’s tax system.
"We can say to Spar and to Philip Morris that if you won’t pay this tax, then you’ll pay another, but one way or another, you’ll pay," the FT cited him as saying. "You can go complain to the EU, but then you’ll just pay more. And it’s going to be this way for every group that presses charges against a country where it wants to earn money," he added.
Migrants vs. Fence
Lázár warned that by the end of the day more than 90,000 illegal migrants will have crossed Hungary’s border since the start of 2015, and that by the end of the year their number could reach 200,000 to 250,000 but possibly even 300,000.
Under a recent decision the government will have a security fence built on the Hungarian-Serbian border within the shortest time possible, the minister said. Report have been about a November completion on the 175-kilometer stretch, but works will most likely accelerate now, he added. The fence will be dug 1.5-meter deep into the ground and reach 3 metres high, topped by NATO razor barbed wire with coil diameter of 50-70 centimetres. There will be two types of fences. One will be built on a cc. 40-km stretch of hardly accessible swamp areas and another on the remaining part. The cabinet expects the border fence to radically reduce the number of illegal border crossings in the country.
The government will use 980 square kilometres of private property to build its fence. It will pay a one-off compensation and a service fee of about HUF 160-170 per square metre. Land owners may turn to court if they are not satisfied by this deal but the construction will not be suspended by any complaint.
