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Coronavirus: Budapest Mayor Denies PM Orbán’s Claims about Capital’s 100 Billion Plus

Ábrahám Vass 2020.09.14.

While the Prime Minister insisted that Budapest has enough money, around HUF 100 billion to spend in the mitigation of the local, economic effects of the coronavirus crisis, mayor Gergely Karácsony denied this and called up the government to stop curbing the capital.

In his Facebook post, Gergely Karácsony insisted the capital has no money to take over the responsibilities of the government. “We don’t have 100 billions free, we in fact have a 150 billion deficit.” And in addition to the effects of the epidemic and the economic downturn, the government’s austerity measures play a big role in that too, he claimed. “Whoever has the money has the responsibility,” he concluded.

Karácsony’s message came as a response to the Prime Minister, who in his interview to state news channel M1 said that the Budapest leadership inherited HUF 100 billion (EUR 280 million) from the previous (Fidesz-backed) one, out of which 50-60 billion should be spent in supporting local businesses, mostly in the tourism industry.

According to Viktor Orbán, the government did not distinguish between the countryside and the capital, it helped everyone with tax cuts and contribution deductions, but Budapest needs a special plan. He explained that  Budapest’s tourism is perhaps in the biggest trouble as it is almost entirely made up by foreign tourists, and therefore it basically “collapsed”. As a result, special measures and a business model change would be needed in the capital, he said. “But fortunately, the capital still has more than HUF 100 billion free in funds,” Orbán claimed.

In connection with Orbán’s statement, Karácsony earlier referred to deputy mayor Kata Tüttő’s words, who said that the city’s only remaining tax revenue, the business tax, is expected to fall significantly due to the crisis. According to the leadership of Budapest, the government further curbs this “single revenue left here,” as it recently decided to withdraw more than HUF 30 billion (EUR 84 million) a year. Moreover, public transport is also expected to generate a loss of around HUF 30 billion due to the decrease in ticket sales, Tüttő wrote.

The government, thus, further swindles the city, from which it already takes away nearly 97% of the tax revenues generated through the central budget, she commented.

Tüttő also claimed that when they took over Budapest, they only found debts. While, “if the city indeed had HUF 100 billion plus, why did the previous leadership leave three millions of square meters of roads in terrible condition,” for example. She argued that If the government indeed wants to help Budapest, it should pass on half of the EU recovery funds for the municipalities on a pro-rata basis, it should stop excluding opposition-led cities from the subsidies, or it should bring the municipalities into decision-making about the EU funds due to support the rebuilding of the economy.

featured image: PMO Chief Gergely Gulyás with Karácsony; via Noémi Bruzák/MTI