More than 3,000 billion forints (EUR 9.7bn) has been left with Hungarian families since Hungary’s Fidesz-KDNP government came to power in 2010, Prime Minister Viktor Orbán said at the Figyelő Top200 award gala, an event acknowledging Hungary’s most successful businesses organised by news weekly Figyelő reported on Saturday.
The savings include those from tax preferences for families and newly married couples as well as the lower tax rate and the introduction of a flat-rate tax system, Orbán said.
his government had taken some pages from the “Reagan catechism” and “put a brake on inflation, continuously cut taxes and put the communists in mothballs”.
Hungary was at rock bottom in 2010, but “as Hungarian logic dictates: when at rock bottom, look at the foundations”, he said. The government did just that and found that the foundations were good: “Hungarians like to work, they can work hard and take initiative…and they are able to take responsible decisions,” he added.
If the foundations were good in 2010, that meant that there was a problem with policy, as that policy couldn’t draw on those resources, he said.
Orbán acknowledged the cooperation and contribution of businesses in the implementation of the government’s policy after 2010.
“Although they ground their teeth, the banks still stood by the government and paid the bank levy, the multinationals and the Hungarian companies stood by the country and paid their sectoral taxes, and the SMEs also accepted what they had to,” he said.
We have come so far as to have been able to form an alliance with businesses last year that includes tax reductions,
he said. “With this, we’ve started a new period of Hungary’s economic history, because we’ve brought to an end the era of low wages,” he added.
“There is still much left to do,” Orbán said, adding that Hungary is still toward the bottom end of the mid-range in Europe when it comes to being an entrepreneurial society. He noted that other countries in the region, countries that had been freed from the yoke of communism at the same time as Hungary, had been more successful at accumulating capital and now had a significant amount of private assets. He attributed the discrepancy to the longer time it took Hungary to “sweep up the remnants of communism” as well as “perhaps Hungarians’ behaviour upon EU accession” which he compared to a “husband in love”. “We believed everything and saw nothing,” he said.
Today, we can say that establishing the Hungarian model was a good decision, Orbán said.
“Instead of a welfare-based economy, we established a work-based economy, and we made sure that Hungary’s success, not just profit, was in the interest of foreign investors,” he added.
Some say the success of the Hungarian economy is just temporary, ” but I think that you, who are familiar with the reality of the Hungarian economy, know precisely that the Hungarian economy is on firm footing” and that we stand before an upturn that is in large part due to successful Hungarian businesses, Orbán said.
Orbán said Hungarian companies have enough “surplus strength” to invest beyond the country’s borders, in all of the Carpathian basin.
“I want to see Hungarian or Hungary-based companies grow into leading regional businesses, and I want to see Hungarian global brands, too,” he added.