Budapest, November 24 (MTI) – Economy Minister Mihaly Varga submitted a proposal to Parliament on Tuesday on changing the rules of Hungary’s banking tax, in effect reducing its rate and introducing incentives for financial institutions that increase their lending in the future.
For banks with total assets under 50 billion forints the banking tax will remain at 0.15 percent but for banks with assets above that amount the tax will be reduced from 0.53 percent to 0.31 percent. In 2017 and 2018 the bank levy will be reduced to 0.21 percent.
As a further measure the banking tax for individual institutions in the 2016 financial year will be capped at 45 percent of the amount they paid in 2015. In 2017 and 2018 the levy will be capped in the amount banks paid in 2016.
As an incentive the Economy Ministry is proposing to further reduce the bank levy for banks in 2017 and 2018, practically capping it at 30 percent of the amount paid in 2015, if they increase their corporate lending and their lending to SMEs in 2016 through transactions and outlays. Lenders will also be eligible for this incentive in 2017 and 2018 if they increase their retail lending to households in 2016 through outlays.