Finance Minister Péter Oszkó has posted a detailed comment on the blog of Edward Hugh, the author of Hungary Economy Watch.
Oszkó counters the blogger’s criticisms of the effectiveness of the government’s fiscal measures and questions the value of drawing comparisons between Hungary and Greece.
According to Hugh, the only measures which could come near to being called structural reforms that have been implemented to date are the withdrawal of the “13th-month” pension payment and the cuts in the maternity leave system. These measures are not really reforms at all, but deficit-reducing measures, he adds.
In his lengthy response Oszkó cited more than a dozen government measures, including its restructuring of the “generous” housing subsidy system, increasing Hungary’s retirement age, phasing out energy subsidies, introducing performance limits at hospitals, launching the communal work programme and reducing employment taxes.
Under Oszko’s watch, we see yet more tenuous taxation implemented: like the wealth taxes – taxes that meant to go after those with assets – who were already theoretically taxed on those same assets – and now have to pay “again”.
It’s obvious that HU doesn’t know that it’s destroying it tax base. How can anybody feel comfortable that what s/he buys today won’t be “re-taxed” tomorrow? Why would any company, doing its due diligence, conclude it’s safe to set up here? Reform is about making systems fairer, more transparent, etc. Just using the word, doesn’t mean it actually is a reform.
In fact, this latest “reform” (luxury vehicle tax) might be the final tax that leads to an outright refusal to pay taxes. For HU has managed to hit ordinary people without wealth, just a particular sized engine. There are people out there whose vehicles are worth say 200K and have to pay 65K in tax. In fact, those people have just seen their assets devalued due to the “new” tax.
Many people are now saying they’ll refuse to pay the tax, while there’s a petition to repeal the tax. If this is the outcome of a “reform” – then you have to question the competence of the policy makers and wonder how then nation will ever pull itself out of the mire.
A country which is on the verge of bankruptcy because of corruption and inefficiency forces itself into yet deeper trouble by seeking
a way out of the mess by taxing everything.
Gyurscany went sometime ago. Now it is time for the
MSZP to pack its bags before they can do any more damage.
A country which is on the verge of bankruptcy because of corruption and inefficiency forces itself into yet deeper trouble by seeking
a way out of the mess by taxing everything
OdaAfa at February 6, 2010 2:43 PM
—-
And how should Fidesz get more income to the state without rising the taxes and enforcing tax collection more efficient?
Or should Fidesz only sack 50% of all public employees and sell off all publicly owned companies?
What other options do Fidesz have?
Orban has been speaking about the need for austerity measures since 2006, he just qualify these with that the ‘public must approve them’…
Good Luck!
Viking.
If I relied on Orban Viktor for anything I should be a worried man. I am.
The government can’t collect tax. That’s why we have AFA @ 25 per cent.
We cannot wait another generation for things to change as FL suggests. Start the ball rolling now.
At least the people who have read AllHungary media sites must know by now that we are not going to get the necessary reforms via MSZP or Fidesz.
Viking, you are joking, right? How many laws are
on the books currently, that in most other
countries generate substantial income. Case in
point, traffic violations/auto violations. As far
as I know, driving with a broken headlight or
brakelight merits a fine, yet i’ve never seen more
cars with missing lights than in Budapest. God
forbid the police actively enforced it, as that
would provide some income, and in this case, i
know they don’t even pocket the money, as there is
still way too many cars out there like that.
Next, Dog turd. Again, as far as I know, there is
a law on the books where if you don’t pick up
after your dog, you get a fine. Is it enforced?
Obviously not, since the streets of the VII are
covered in crap. Next, parking. In most cities,
parking fines go to the municipality, and it’s a
good source of income. In Budapest? Sold the
rights, since the city obviously doesn’t need the
money. You know the saying, a dollar here, a
dollar there, before you know it, you’ve got some
real money. Bottom line is that there are so many
laws on the books which would enhance the city
both financially as well as visually, and there
are never enforced. Raising taxes is just
foolishness, when all they’d need to do is simply
enfore the current fine system.
Sorry for my bad spelling, saw the superbowl last
night and i’m still asleep
In a city in the UK some years ago the refuse collection service was taken away from local council and put in the hands of a French-run business.
The quality of the service improved 100%.
The trucks rolled up on time; emptied the bins and took excess rubbish away and there was not a toffee paper left blowing in the wind.
This was a complete turnaround to what we had been used to with the council binmen. Bins half-emptied, and left some distance from the house,
papers flying about everywhere that required a second council van to come and sweep up
a day later.
Hungary is a mess. Poor government,inefficient bureaucracy, outdated local councils, and massive corruption.
Who is going to sweep this little mess up?
DustyBin, you’re missing the point I’m trying to
make, though, since I’m still out of it, let me
apologize in advance if you were simply making an
observation. The difference in what you’re
talking about and what I was discussing is that
while some municipal services are commonly
contracted out to private companies, most cities
tend not to contract out regular sources of
revenue. One lump sum payment,(and lets be honest
here, I strongly believe that in typical Hungarian
fashion, 2 or 3 people got most of the money as
opposed to it being for the municipality) versus a
regular source of incoming. Living here for 6
years, I still can’t understand why they don’t
realize that there are so many viable regular
sources of income to be collected, and yet do
nothing about it. It’s so frustrating.
@ WillG. I do take your point and my post as you correctly summize was just an observation.
Common sense is in short supply with councils and government. Posters regularly remind them of this on this site.
I was with a bank manager today discussing various matters (mainly political).
Hungary needs a collective effort with banks, government, local councils, business development agencies, investors, etc., all participating to help put right the hopeless shambles we now find ourselves in.
Rock on the Saints. Way down yonder in New Orleans, In the land of Jacks and Queens!
Buli time….it appears you have over-indulged already?