Although the goal is to spread the use of the internet across Hungary, since the country is far behind other EU states in this respect, the government nonetheless plans to tax internet service providers, reports Index.hu.

If the bill passes, prices will increase across the entire Hungarian Internet service market, because service providers will raise their tariffs to compensate for the new tax.

Géza Szathmári, chairman of ATSzE (Alliance of Alternative Telecommunications Providers) and manager of Internet service provider company GTS Datanet points out that although broadband tariffs dropped to 20% of their former rate over the past five years, one of the most important obstacles toward the spread of internet usage is still its cost.

The number of broadband subscriptions rose by more than 40% in 2007, which is a faster growth rate than the EU average, but Hungary is still way behind.

By the end of 2007, there were 20 broadband subscriptions per 100 inhabitants on average in the 27 EU member states, while in Hungary this rate was only 14.2 subscriptions per 100 people. Taxing internet service providers is both an unknown practice in EU states and counterproductive to the goal of increasing internet penetration.