Last year, the Government has brokered the six-year wage agreement aiming to end the era of low wages in Hungary, Minister of State for Taxation András Tállai told political daily Magyar Idők. This year, wages have risen rapidly, more and more people have a steady job, and budget revenues have increased, he added. In the first six months of the year, revenues were up by HUF 140bn compared to the same period of the previous year.

Taxation has a unique logic, he noted. In certain cases it is worth cutting taxes, as taxpayers are more willing to pay lower tax rates, he stressed.
The most remarkable growth was observed concerning personal income tax and payroll tax revenues – despite the fact that the latter was reduced substantially, from 27 percent to 22 percent.

Taxation is a key factor in the proper operation of the economy, and therefore it is important for the Government to amend tax rules in a precise and timely manner, András Tállai said. The assistance of economic actors by the tax authority is another crucial factor. The new rules on taxation were designed accordingly: law-abiding enterprises are to receive VAT refunds within 45 days, a shorter period than before. In the first six months of the year, the amount of VAT refunds transferred back to the enterprises in question was HUF 240bn higher than last year.  This is one of the ways by which the Government rewards economic actors who play by the rules, he said.

(Ministry for National Economy)