Hungarian government: Local councils prohibited from increasing taxes next year

The government has ordered local councils not to increase local and municipal taxes next year. Further, councils must not introduce any new tax or eliminate or reduce existing tax breaks, the finance ministry has said in a statement.

The government’s aim is to make life easier for Hungarian businesses and households struggling to cope during the coronavirus pandemic, the statement released late on Tuesday said.

Párbeszéd: Government stymieing local councils by prohibiting them from increasing taxes

Opposition Párbeszéd on Wednesday accused the government of effectively hobbling the operations of local councils by ordering them not to increase local and municipal taxes next year or introduce any new taxes.

Párbeszéd’s deputy group leader, Bence Tordai, told an online press conference that

the order came from same government which “promotes itself” as being dedicated to tax cuts.

At the same time, “we know that they have carried out the most severe tax increases over the past ten years,” he added, citing the introduction of the flat tax rate which resulted in higher taxes for low earners and the 27 percent VAT.

As we wrote before, the Budapest Chamber of Commerce and Industry (BKIK) was also against a proposal by MKIK’s head to suspend the payment of local business tax (ipa) to municipalities, read more HERE.

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Source: MTI