Varga: FX Loan Conversion Generates No Need For New Special Tax

(MTI) – Despite the views of some analysts, the possible conversion of forex loans into forint denominated ones will not generate a need for introducing any new special tax, Economy Minister Mihaly Varga said on Wednesday, in connection with a critical report published by the European Commission.

Interviewed by commercial news channel Hir TV, the minister said that banks should calculate precisely the damage caused to their clients by unilaterally modifying loan contracts and reach a fair settlement with them.

The EC said in a report published on Tuesday that Hungary was likely to need further fiscal consolidation efforts to avoid the re-opening of an excessive deficit procedure, due to the slow pace of the country’s debt reduction.

The minister called the report “biased and containing several subjective elements”. He noted, however, that the commission acknowledged the recent pickup in economic growth, and Hungary’s achievement in keeping its deficit below 3 percent of GDP.

Varga reaffirmed the government’s commitment to the measures that produced these achievements over the past year. For instance, it does not accept the commission’s proposal for reducing the tax benefits of low-income people or phasing out special taxes, he said.

Photo: MTI – Szilard Koszticsak

Source: http://mtva.hu/hu/hungary-matters