Hungary’s new government has set its sights on adopting the euro by 2030, with Finance Minister András Kármán revealing how and when the country could bring its budget deficit below the EU’s key 3% threshold. The government says it will tackle the country’s huge fiscal gap without imposing austerity measures on households.
Hungary targets euro adoption by 2030
The new government plans to meet the Maastricht criteria required for euro adoption by the end of the current parliamentary term in 2030, Kármán said in an interview with Hungarian public broadcaster Kossuth Radio. One of the most important conditions is bringing the budget deficit below 3% of GDP. The target is particularly challenging given the fiscal situation inherited by the new administration following the spring 2026 election.
According to Portfolio, Kármán said the government would submit a new medium-term programme by the end of October, alongside next year’s budget. This will set out the path towards meeting the criteria for joining the euro area by 2030. The government argues that adopting the common currency would eliminate Hungary’s exchange-rate risk and contribute to permanently lower inflation and interest rates, providing greater stability and predictability for households and businesses.
Deficit was much worse than expected
According to Kármán, the previous government’s 2026 budget had initially been based on a deficit target of just 3.7% of GDP. However, a review carried out after the change of government found that the deficit could have reached 8.3% without intervention. The finance minister said the previous budget had relied on unrealistic economic growth assumptions and that numerous unfunded spending commitments had been made before the election.
He also pointed to hidden financial obligations and projects whose actual costs under existing contracts were significantly higher than the amounts included in the official budget. The revised 2026 budget now targets a deficit of 7.5% of GDP.
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Government promises no household austerity
Rather than raising the burden on households, the government says it plans to close the fiscal gap by cutting wasteful state spending and renegotiating or cancelling overpriced contracts. Kármán said the government had already saved around HUF 400 billion (EUR 1.1 billion) this year by terminating or renegotiating unfavourable state contracts. A further HUF 300 billion in excessive spending is expected to be reversed by the end of the year.
Among the measures cited by the minister are the abolition of the Sovereignty Protection Office, cuts to MPs’ remuneration and the cancellation of an operating contract for part of the M6 motorway. The latter was reportedly reassigned to another operator at around one-third of the previous price, which the government estimates will save approximately HUF 100 billion over the next 11 years.
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Targeted support instead of blanket benefits
Kármán said the government’s economic policy would also place greater emphasis on means-tested social support and transparent management of public funds. The new administration has introduced a HUF 100,000 school-starting allowance, removed VAT from prescription medicines and increased the social firewood allowance, he said.
A similar targeted approach is expected for pensions and potential additional benefits, such as a proposed pensioners’ SZÉP Card. According to Kármán, support should primarily reach those who genuinely need it. Following Prime Minister Péter Magyar’s subsequent announcement that the lowest old-age pensions would be raised to HUF 120,000, Kármán added that the lowest pensions would be increased further on a tiered basis.
Kármán’s interview can be listened to below (only in Hungarian):
New tax scheme could replace KATA
The Finance Ministry is also working on a new simplified tax regime with minimal administration, aimed at self-employed people and small businesses. The scheme is intended to provide an alternative to the former KATA small-business tax system, which was significantly restricted in 2022. For the government, the aim is to combine a simpler tax environment for small businesses with a more sustainable fiscal framework.
Can Hungary really join the euro by 2030?
The 2030 target represents a significant shift in Hungary’s economic policy. Meeting the Maastricht criteria would require a substantial improvement in public finances, particularly given the current 7.5% deficit target.
Kármán stressed that EU rules allow a new government following a change of government to present a fresh medium-term fiscal programme. The new administration now plans to use that opportunity to set out a path towards getting the deficit below 3% and fulfilling the conditions for euro adoption by 2030.
