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Hungary refuses to give up its financial sovereignty by introducing a global minimum corporate tax rate, finance ministry state secretary András Tállai told publisher Mediaworks, arguing that such a tax would hurt businesses, consumers and the economy as a whole.

In the article published in the Saturday edition of the daily Magyar Nemzet, Tállai said the introduction of the tax rate proposed by the OECD would eliminate global tax competition, and noted that the tax rate was also supported by US President Joe Biden.

Hungary’s 9 percent corporate tax rate is the lowest in the European Union, and this has given the country a clear advantage in the race for international investments, Tállai said. “We will not agree to giving that up,” he added.

Foreign Minister: Hungary Rejects Plans to Introduce Global Minimum Tax
Foreign Minister: Hungary Rejects Plans to Introduce Global Minimum Tax

"It has become clear over the past decade that raising taxes is a dead-end-street."Continue reading

Tállai noted that the government had introduced a new tax policy in 2010, levying temporary special taxes on banks, telecommunications companies, energy companies and retail chains. This generated some 500 billion forints (EUR 1.4bn) in tax revenue for the state budget over a three-year period, he added. “But these rules were drafted in a way that ensured that they would not threaten the operations or profits of these corporations,” he said.

These taxes were later challenged in the Court of Justice of the European Union, which ultimately ruled in Hungary’s favour, Tállai noted.

The government refuses to impose taxes that will hurt domestic companies and the economy at Brussels’s request, and won’t do so at the request of Washington either, he said.

Featured photo by Zsolt Szigetváry/MTI