As a result of the Job Protection Action Plan, tax liabilities of employees and small enterprises will decline by 300bn HUF. Taking into consideration that that the proportionate flat rate personal income tax system left 500bn HUF at taxpayers and families, and levies on the profits of small enterprises have been reduced by 150bn HUF, together with the measures announced lately which total 300bn HUF and are aimed at cutting burdens the tax liabilities on employment will be almost 1000bn HUF lower.

The foremost objective of the government with the Job Protection Action Plan is to secure existing jobs, but as advocacy groups during negotiations with them have pointed out hiring could also pick up as a consequence of the programme.

Such measure which eases the tax burden of employees and small enterprises by almost 1000bn HUF has been nonexistent under the previous governments, therefore the government is justified to expect that the substantially lower taxes will be paid by those at issue. In order to secure the resources for the Job Protection Action Plan the government anticipates that the National Tax and Customs Administration of Hungary – just as it achieved extra revenues of 40bn HUF last year – will further improve the efficiency of tax collection this year. The latter step, in turn, will contribute to securing the amount of 300bn HUF required for the programme in the budget.

(Ministry for National Economy)