Spar leaving Hungary? Here is the official reaction
Gergely Gulyás, the Minister of the Prime Minister’s Office, said the government sued the German company for defamation. That means another round in the conflict between the Orbán cabinet and Spar. Will they finally give up and leave Hungary? Here is the official reaction.
Foreign retail chains “need to be pushed out of the country”
In 2020, János Lázár, Hungary’s Minister for Construction and Transport, said that the retail trade of grocery items had to be dominated by Hungarian businesses. Therefore, the government would like to break the power of foreign chains in that sector.
He plans to do that, among other means, by taking advantage of additional taxes and levies. That means the government would like to reach their goal not by increasing Hungarian companies’ competitiveness but by the administrative repression of foreign chains. That is what they seem to have started after the latest supermajority of Orbán’s ruling Fidesz-KDNP coalition.
Spar will be brought court for defamation
The current conflict followed Austrian Spar CEO Hans Reisch’s sharp criticism, slamming the excess profit taxes of the Hungarian government. Mr Reisch mentioned other government measures restricting competition in Hungary’s retail market. As a result, Spar turned to the budget supervision committee of the European Parliament. Afterwards, Gergely Gulyás announced that the Orbán cabinet would bring the company to court for defamation.
The company’s board of directors sent a letter to their employees after the scandal. They wrote they would be profitable without the extra burden of the Hungarian government taking away EUR 8,500 per employee every year from their Hungarian subsidiary.
EUR 76 million extra tax
They added they did not plan to leave the country. Instead, they would like to open new stores and renew the existing ones.
Gabriella Heiszler, the CEO of Spar Hungary, highlighted at an extraordinary press event that the Hungarian subsidiary was loss-making in 2023, just like in 2022. In 2023, they paid EUR 76 million extra tax to Hungary’s budget. Without that, they would have been profitable.
Concerning a possible exit, Heiszler said she was not a decision-maker in that issue. But based on her conversations with the owner, Spar would not leave Hungary, she added.
Spar Hungary employs 14 thousand people in Hungary and is Hungary’s fifth largest employer.
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