The prime minister said banks, insurance companies, large distribution chains, energy and trading companies, telecommunications companies and airlines would be obliged to pay "a large part of their excess profits."Continue reading
Economic Development Minister Márton Nagy has informed the Banking Association about the government’s decision to strip several sectors, including banks, of their extra profits.
In a statement, the minister said “we are in extraordinary times… which call for extraordinary measures”.
Right after the coronavirus pandemic and amid energy prices rising at an unprecedented pace the world is facing an economic crisis, while Hungary must work to stay out of the war in Ukraine and protect the financial security of families, Nagy said.
The government is seeking to ensure the necessary room for manoeuvre through a broader distribution of the public burden, the minister said. The government has established that banks, through a higher base rate and low retail deposit rates, are “earning outstanding or extra profits”, the minister said, adding that an extra profit tax would be introduced for a two-year term.
The government is committed to reducing the state debt and the budget deficit, increasing economic growth and protecting “the social achievements of the utility cut programme”, Nagy said.
Featured photo by Attila Kovács/MTI