Dec 29, 2016

Hungarian government's allocation for families is unparalleled in Europe

The government will spend 4.7 percent of GDP on family subsidies in 2017, a share unparalleled in Europe

The Hungarian government's allocation for family subsidies is unparalleled in Europe, it has been revealed.

Bence Rétvári, the parliamentary state secretary at the Ministry of Human Capacities, said that the government will spend 4.7 percent of GDP on family subsidies in 2017, a share unparalleled in Europe.

According to MTI, next year’s budget will raise tax breaks for approximately 350,000 two-child families, Rétvári said. Between 2016 and 2019, the monthly tax benefit for families with two children will double to 40,000 HUF, he said. Next year, this benefit will be 30,000 HUF.

The reduction of VAT rates on milk, eggs and poultry from 27 percent to 5 percent will leave two-child families with an additional 35,000-40,000 HUF a year in disposable income on average, he said.

Rétvári said lower earning families will be helped by a 15 percent rise in the minimum wage for unskilled workers, which he said will leave an additional 130,000 HUF with families next year. The 25 percent minimum wage increase for skilled workers will raise families’ annual disposable income by around 260,000 HUF, he added.

Military personnel and police officers will also see their wages increase further next year, he said. From September, teachers will also receive a pay rise, which will be followed by an increase in the wages of doctors and nurses in November, the state secretary added.

Next year the government will spend an additional 2 billion HUF on providing free hot meals for needy children, he said.

With next year’s increased family benefits, Hungary will become by far one of the most generous OECD countries in terms of spending on family subsidies, Rétvári said.