The Hungarian tax system has been the subject of numerous criticisms as it tends to favour wealthier citizens. However, there are discounts for those who earn the least in Hungary.
Hungarian minimum wage earners have the highest tax burden
The annual report of the International Labor Organization (ILO) contains information about taxation in Hungary. They examined the taxation of the minimum wage in 42 countries. According to their analysis, the tax burden on minimum wage earners is the highest in Hungary worldwide, reports 7g.hu. Only Germany has higher taxes, but several member states of the United States, as well as Belgium, impose fewer taxes on minimum wage earners.
High-income earners pay particularly low taxes
While the poor are struggling to pay huge amounts of money, the wealthier class enjoys particularly low taxes. Out of 154 countries and territories, Hungary has the 59th lowest taxation of high-income earners, writes 24.hu. Among European countries, only the similarly or less developed countries (Albania, Montenegro, Moldova, Bulgaria) apply lower taxes. The only developed country that applies income taxes similar to Hungary is New Zealand. However, there are discounts for low earners there, too.
Being single and poor is the most expensive in Hungary
Those Hungarian taxpayers who live alone and have no children pay a particularly high amount of taxes. There is no other developed country where a childless worker earning half the average wage would have to pay such a high tax burden as in Hungary. Those earning half of the average wage must pay 1,6 times the average deduction typical among OECD members from their wages to public costs. Even in Belgium, which imposes the highest tax burden in the world, it is much better to be poor in terms of taxation than in Hungary. Belgian workers earning half the average wage pay a third less in taxes and contributions than Hungarians.
Although people living in Hungary have to pay high taxes, there are some discounts, too. The government expresses its support towards families in the form of family support money. Since 2009, it is HUF 12,000 (EUR 28,26) per month for one child, HUF 13,300 (EUR 31,33) for two children, and HUF 16,000 (EUR 37,69) for three or more children. However, this is still shockingly low according to the OECD report. A family with an average income pays more taxes on their income in Hungary than the average in developed countries.
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Source: 7g.hu, 24.hu
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