Daily News Hungary

Budapest, October 30 (MTI) – The government submitted the 2015 budget bill to Parliament on Thursday, one day before the legal deadline.

Economy Minister Mihaly Varga ceremoniously presented the bill to House Speaker Laszlo Kover in digital and printed form at a press conference early in the afternoon.

The bill targets a 2.4pc-of-GDP general government deficit, calculated with European Union methodology, lower than the 2.9 percent target for this year. It also targets a 0.9 percentage point reduction of public debt as a percentage of GDP to 75.4 percent, excluding exchange rate changes.

The bill assumes GDP growth of 2.5 percent. It assumes household consumption will climb 2.6 percent.

The government projected GDP growth of 2.5 percent for 2015 in the country’s updated Convergence Programme submitted to Brussels last April.

The bill assumes a 1.3 percent increase in employment, 1.8 percent average annual inflation and external financing capacity equivalent to 8.4 percent of GDP.

Varga said the budget includes sufficient reserves, represented by 60 billion forints in the country protection fund, up from a previously calculated 40 billion forints, and 100 billion forints in general reserves.

The 2015 budget is dedicated to making banks accountable, Varga said after submitting the bill.

The family-focused tax system will be maintained next year, with 240 million forints left in families’ pockets. The opublic utility scheme will continue and households’ public utility burdens will be reduced by an additional 20-25 percent, he said.

Wages will be increased in several sectors, including 44 billion forints to be allocated for those working for the armed forces and police and 38 billion forints for teachers, he said.

Local councils will get access to 2,500 billion forints next year and the central budget will provide an additional 690 billion forints. Varga said next year will be the first year that local councils can start without outstanding debt, thanks to the government’s debt consolidation scheme this year, he said.

Kover said the parliamentary debate of the bill start on November 17. Committees will debate details of the bill on November 26 and 27, and the final vote is planned to be held on December 15, he added.

In an opinion published on Monday, the Fiscal Council identified some risks with the bill but did not raise objections on the whole. The council pointed to risk of lower economic growth and lower inflation, and it recommended that risk reserves be raised. It also noted that detailed information on measures related to tax revenue and expenditure cuts was lacking.

Varga said sectoral taxes, such as those on advertisers and banks, would remain in place in 2015.

Source: http://mtva.hu/hu/hungary-matters

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