Minister Nagy presented 2026 anti-war budget in the parliament, talks about medicine price caps
National Economy Minister Márton Nagy called the government’s 2026 budget bill an “anti-war budget” at the start of debate of the draft legislation in parliament on Wednesday.
Anti-war budget, says Minister Márton Nagy
Nagy said the 2026 budget aimed to mitigate the negative effects of the war in Ukraine and focused on support for families raising children, young Hungarians and pensioners.
The budget seeks to ensure the security of every Hungarian family, while allowing all Hungarians to “take a step forward”, he added.
He said the budget also provided guarantees for the continuation of Hungary’s work-based society.
Hungary’s government will roll out Europe’s biggest family tax cut programme in 2026, while maintaining the regulated utilities price scheme for households, ensuring pensioners get their annual bonus, protecting workplaces and creating new jobs, he said.
He noted that the 2026 budget bill assumed 4.1pc GDP growth and 3.6pc average annual inflation.
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Family support
The deficit target is 3.7pc of GDP, which assumes a primary deficit — excluding debt maintenance costs — of zero. Year-end state debt, relative to GDP, is set to fall to 72.3pc from 73.5pc.
Among expenditures in the budget are HUF 800bn in interest payments on government securities held by Hungarian households. Tax measures include a doubling of the tax allowance for families raising children and a personal income tax exemption for mothers of two under 40.
Nagy said the PIT exemption would leave around HUF 377bn with households, while the higher tax allowance would leave HUF 290bn. A PIT exemption for under-25s, introduced earlier, will cost the budget HUF 237.5bn, he added.
Family support in the budget adds up to HUF 5,600bn, including the HUF 800bn in support for the regulated utilities price scheme for households.
He also highlighted a 13pc increase in the minimum wage and a bonus, equivalent to six month’s salary, for Hungarians in uniform.
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Drug price caps
Nagy said the “most important” issue of 2026 concerned whether or not Hungarians’ money would go to Ukraine. He added that Brussels’ initiative to accelerate Ukraine’s European Union accession would come at “enormous cost” to Europe and Hungary, too.
He pointed to government measures to mitigate inflation, including mandatory caps on markups for some food and household products, as well as voluntary freezes on banking and telecommunications fees, and home insurance premiums. He said talks had also started on bringing down the prices of drugs that are not subsidised by the state.
The budget earmarks around HUF 5,050bn for economic development, including HUF 2,200bn in EU funding.
Additional 2026 expenditures
The budget also ensures resources for an economic policy action plan that aims to boost purchasing power, ensure affordable housing and scale up local SMEs in the framework of the Demjan Sandor Programme.
The budget earmarks HUF 7,700bn for pension-related expenditures, including around HUF 24bn for an economic growth-linked premium.
Expenditures on healthcare are targeted at HUF 3,919bn, up by HUF 280bn from a year earlier.
Spending on defence will reach the 2pc-of-GDP threshold, climbing 15pc to HUF 2,016bn.
Education expenditures will climb more than HUF 160bn to over HUF 4,000bn.
Around HUF 653bn will go to culture and local council support will add up to HUF 1,419bn.
Payouts for EU-funded projects are set to reach HUF 2,700bn, while transfers from Brussels come to HUF around HUF 1,800bn. At the same time, Hungary will contribute HUF 789bn to the EUR budget.
Acting on the recommendation of the Fiscal Council, Nagy said the government had cut expenditures by HUF 142bn, but would replace the amount, if tax revenue trends turn out as expected. Budget reserves were raised from HUF 50bn to HUF 192bn, he added.
Fiscal Council and State Audit Office opinion
László Windisch, who heads the State Audit Office (ÁSZ), told lawmakers that the budget was “well-founded”, but meeting revenue targets depended on the macroeconomic assumptions in the bill panning out. He added that there was “much uncertainty” surrounding macroeconomic developments in 2025 and 2026, but acknowledged a “realistic chance” for the government’s forecasts to materialise.
Gábor Horváth, the head of the Fiscal Council, acknowledged the government’s move to raise reserves for “extraordinary government measures” and cut expenditures by the same amount.
He pointed to risks posed by drawn out geopolitical conflicts and trade policy tensions to macroeconomic assumptions in the bill.
He also said that the projection in the bill for business sector wage growth, that was more than two percentage points over the value in a minimum wage agreement signed in November 2024, lacked explanation.
The Fiscal Council has identified lower-than-expected growth as a risk to achieving the 2026 deficit target, while also noting uncertainty surrounding the arrival of Hungary’s EU funding.
Fidesz: 2026 budget ‘based on peace, economic growth’
Ruling Fidesz’s 2026 budget bill has been drawn up “in the name of economic stability, social well-being and confidence in the future”, a spokesman for the party said in the general debate on the budget in parliament on Wednesday. Eric Bánki said the budget was aimed at “ensuring an opportunity for everybody to prosper while maintaining fiscal discipline”.
Bánki said the “greatest question for 2026” would be “whether or not the money of Hungarians is sent to Ukraine”. “The Brussels bureaucracy and the majority of the European Parliament is ready to make European countries arm Ukraine and give the country financial support,” he said. Next year’s budget, however, “aims to spend Hungary’s resources on Hungarian families rather than on Ukraine”, Bánki said, calling the bill an “anti-war budget that puts Hungarian families first.”