AFP
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NOS News•yesterday, 23:36
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Despite massive day-long demonstrations in Budapest against a significant tax hike, Hungarian President Novák has endorsed the tax reform with his signature. As a result, the self-employed and freelancers, who currently still benefit from a low rate, will pay much more tax from 1 September.
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For six days, demonstrators blocked bridges over the Danube in Budapest and major thoroughfares. They feel that they have to pay for Hungary’s economic problems. Protesters also took to the streets in other cities tonight. The police used tasers to disperse them. New protests have been announced for the coming days.
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Opposition parties have joined the protest, calling on Prime Minister Orbán’s ruling Fidesz party to reconsider tax reform. Fidesz, that through the district system has a large majority in parliament, does not seem willing to do so. Protesters hoped the president would block the bill, but those hopes proved futile.
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The category of self-employed and freelancers with a low tax rate now numbers about 450,000 Hungarians. From 1 September, only self-employed persons who work for private individuals will still be subject to this rate. Anyone who works for a company, such as flash couriers, IT professionals and designers, will have to pay considerably more tax from September.
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Forint drops
Hungary has one of the highest inflation rates in the European Union. The Hungarian currency also loses value. At the beginning of this year, 1 euro was still equivalent to about 360 forints, but that has now risen to more than 400 forints. Hungary’s central bank has therefore raised interest rates by 2 percentage points.
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Prime Minister Orbán blames the economic problems on the EU sanctions imposed on Russia over the invasion of Ukraine. Last Friday, he said the EU was “not only shooting itself in the foot, but also in the lungs”.
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In the meantime, Hungary also has to do without billions from the European corona recovery fund. That money is through Brussels frozen expressed dissatisfaction with the violation of the rule of law in Hungary.
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