State Secretary: Hungary Leads Europe in Decline of Tax-to-GDP Ratio
Hungary’s tax-to-GDP ratio – the sum of taxes and net social contributions as a percentage of GDP – fell 0.9 percentage point last year, the biggest decline in the European Union, state secretary of the finance ministry Norbert Izer told MTI, citing fresh data released by Eurostat.
The data show Hungary’s tax-to-GDP ratio fell to 38.4 percent from 39.3 percent in 2016 while the average ratio increased to 40.2 percent from 39.9 percent in the European Union.
With the lowering of the corporate tax rate to 9 percent in 2017, Hungary not only became more attractive to international investors, but also left a total of 150 billion forints with more than 580,000 domestic businesses, Izer noted.
The government’s tax policy focuses on cutting taxes and simplifying tax administration and the tax cuts will continue, Izer said.
Hungary will be able to retain its excellent position in the EU ranking, the state secretary said, adding that the government aims to halve the time businesses spend on tax-related administration by 2021.
featured image: Norbert Izer; via Tamás Kovács/ MTI