Hungary's parliament passes main figures of 2022 budget

The government's 2022 budget passed with 121 votes for and 60 against.

Hungary's parliament has passed into law the main figures of the government’s 2022 budget, together with amendments by parliament’s budget committee. The budget passed with 121 votes for and 60 against.

According to MTI, targeted central revenues total HUF 25,393.8 billion (EUR 72.55bn) as against expenditure of HUF 28,546.5 billion, with a projected shortfall of HUF 3,152.6 billion. According to a justification to the bill, tourism is crucial for reviving the economy after the coronavirus epidemic, therefore the sector will benefit from a total of HUF 81 billion next year for developments connected to restarting the economy, up from HUF 40 billion this year.

Under the amendments, the Hungarian Academy of Sciences will receive extra funding of HUF 7.3 billion to improve “routine academic services for the scientific community”, as well as to reinforce the Academy’s scholarship programs. Local government offices will receive an extra HUF 10 billion to renew their infrastructure and start new developments. Youth and family organizations will have access to HUF 2.8 billion, HUF 850 million more than in 2021, while ethnic minority governments will be granted over HUF 1 billion forints for their operations. Under the amendment, a finance ministry reserve fund will be raised from HUF 93 billion to 105 billion out of which pay hikes for staff at universities operating under a new higher education model will be paid for, among other items.

Parliament also adopted tax cuts aimed at reviving the economy, with 120 votes in favor and 60 against. Under the new tax laws, employers will pay 15 percent social security contributions, 0.5 percent less than in 2021. Tax paid by individual entrepreneurs will be further simplified with the option of a flat rate if their revenues do not exceed ten times the annual minimum wage or up to fifty times the minimum wage in case of retail traders. Taxpayers in this system will be exempt from personal income tax up to half of the minimum wage. The measure will benefit 70,000 small firms.