news letterOur mobile application

Weekly newsletter

Audit Office Head: Room for Gradual Tax Cut

MTI-Hungary Today 2019.07.11.

The head of Hungary’s State Audit Office (ÁSZ) sees room for a gradual reduction in the 15 percent personal income tax (PIT) rate.

“In my opinion, the current economic conditions allow for a further reduction of the personal income tax in two or three steps,” László Domokos said in an interview published in Thursday’s issue of daily Magyar Hírlap.

He said the 1.5 percent vocational training contribution paid by employers could also be cut to 0.75 to 1.0 percent in light of the lower number of job-seekers, and he made a case for eliminating the 15 percent tax on interest.

“It isn’t normal that we tax savings, but not high-interest, high-risk personal loans. There should be incentives for savings that mature in six months or less, too,” Domokos said.

He said cutting the 27 percent VAT rate “wouldn’t be worth it” as consumers would benefit not at all or only temporarily from such a measure. He added that VAT is the “most equitable” tax form as wealthier households which consume more also pay more VAT.

Featured photo illustration via pixabay.com