Brussels is attacking Hungary because of low tax rates but the Government will not back down and give up the family- and tax cuts-focused economic policy, Minister of State for Parliamentary Affairs András Tállai told MTI.

Hungary is currently the country with the largest tax decreases within the European Union, and the Government is working to keep this title, the Minister of State said. The rate of corporate income tax and personal income tax are among the lowest in the EU, he added.

The fact that the Hungary has been among the top ten investment destinations proves the competitiveness of Hungary’s taxation regime, he stressed.

Last year alone 98 large investment projects have been attracted through the investment incentive programme, and these are to create 17 thousand new jobs. These projects are altogether valued at more than HUF 1380bn (EUR 4.3bn). Brussels, however, instead of seeing Hungary’s competitive taxation regime as a good example, appears to be rather interested in tax hikes and the elimination of tax incentives and exemptions, and the transformation of the current business-friendly system. These, the Minister of State pointed out, will lead to the closure of enterprises, the loss of investors and jobs.

The fight against tax evaders have also resulted in exemplary achievements, András Tállai said. Hungary’s instruments against the grey economy have been examined by the tax authorities of almost every EU member state.  Poland’s SENT system, modelled on Hungary’s Electronic Trade and Transport Control System (EKÁER) was launched on 1 May 2017, and this year Slovakia is also expected to introduce a new online control system. The on-line billing system and the connecting of vending machines to the tax authority has been yet another milestone in the fight against the black economy, he said. The fight against international tax fraudsters and evaders can most effectively carried out together, in cooperation with member states, and Hungary has been a partner in this, András Tállai stated.

In 2017, Hungary was the country with the largest tax cuts, as according to Eurostat data the largest decrease in the tax-to-GDP ratio was registered in the country. “We have a good chance for keeping this title as the Government has left some HUF 290bn more at families and enterprises last year, and this year tax cuts are expected to total another HUF 270bn”, he added.

(Ministry of Finance/MTI)