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Jun 06, 2018

Hungary’s 2019 budget to be presented to Parliament next week

Gergely Gulyás described the budget proposal to be presented to Parliament next week as showing Hungary’s positive economic prospects

Hungary’s 2019 budget is one of “safe growth” said the minister heading the Prime Minister’s Office.

Gergely Gulyás described the budget proposal to be presented to Parliament next week as showing Hungary’s positive economic prospects.

The minister said the foundations of growth are stable, but the signs of a crisis are emerging in the European economy, in particular in the Eurozone.

Gulyás said the sovereign debt is high in several Member States of the Eurozone, a number of countries fail to observe the Maastricht criteria, while the trade war with the United States that is currently unfolding will affect Germany most directly, but it may also have an indirect impact on Hungary.

The minister said the government has increased the general reserves of next year’s budget by 50 percent to factor in for any potential hit. They attribute great significance to the fact that they will deploy measures to boost the Hungarian economy in the interest of promoting economic growth, and therefore next year’s budget will feature investments worth 4 trillion HUF.

He pointed out that the Hungarian economy had grown by 4.7 percent in the first quarter, and with this result it is ranked fourth among the EU’s 28 Member States.

Gulyás said the 2019 budget is a conservative budget reckoning with a deficit of 1.8 percent, which will primarily stem from the promotion of investments and the supply of own resources for investments implemented with EU co-funding.

He also indicated that at the Tuesday cabinet meeting all the ministries had identified their priorities in connection with next year’s budget.

He mentioned among the 2019 budget’s goals that the higher reserves serve to guarantee the country’s security, while investments seek to maintain growth. He added that next year the tax benefits of families with two children will rise to 40,000 HUF per month, while they will also take measures towards reaching full employment.

He concluded that in accordance with the agreement regarding the reduction of contributions, they will further reduce taxes, meaning that the social contribution tax will decrease from 21.5 to 19.5 percent.