Sanctions benefit USA, Russia, hurt Europe?
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Asked if the state of emergency declared due to the war in Ukraine meant that Hungary will mobilise its troops, Gergely Gulyás, the prime minister’s chief of staff said the government had already ordered to tighten the defence of the country’s borders. That level of security will be maintained, but the government sees no reason to increase it for the time being, he said.
If necessary, the armed forces and the police are capable of defending the border, he said.
On another subject, Gulyás said the government believed it was highly unlikely that Russia would attack a NATO country, adding that a well-equipped army reduced the chance of that happening even further.
“We don’t believe Russia poses a threat to any member state right now,”
he said
The windfall taxes announced by the prime minister on Wednesday will be collected into the utilities protection fund and defence fund. Expenditures of the two funds this year will add up to 900 billion forints, Márton Nagy, the minister for economic development, said, adding that 700 billion will be spent on utilities protection and 200 billion on defence. Both funds can still be topped up next year, he said.
In addition to the windfall taxes, the government will also collect around 100 billion forints from smaller tax increases. This will include an increase in the excise tax on alcohol, the public health tax and the tax on company vehicles, among others, the minister said.
Nagy said the move to re-channel the extra profits of businesses would not impact their decision on whether or not they remain in the country. Over the last 12 years, the share of Hungarian ownership within the banking sector has risen above 50 percent, he said, adding that
less than 20 percent of insurance sector players were Hungarian-owned.
Concerning the government’s decision to postpone 861 billion forints’ worth of public investments, Nagy said Hungary had an investment rate of 27 percent, of which public investments accounted for 5-6 percent, the highest ratio in Europe. The government will continue to promote market investments, he said, adding that the drop in public investments would not have such a significant impact.
Gergely Gulyás, the prime minister’s chief of staff, said the government’s rule of thumb on the matter was that only projects that are yet to be started could be rescheduled, most of them being construction projects.
In response to a question, Gulyás said that the utilities protection fund served to keep consumer prices at their current levels.
The defence fund will be used to speed up a planned military upgrade,