Varga announces tax cuts, growth incentives

Finance Minister Mihaly Varga on Thursday announced a number of tax cuts and growth incentives as part of plan to shield the economy from the impact of a global slowdown. Varga said the payroll tax would be reduced from 19.5 percent to 17.5 percent from July 1, 2019. The measure, which he said would leave 144 billion forints (EUR 443.1m) with businesses this year and 156 billion next year, is in line with an agreement reached by the government with employers and unions that links payroll tax cuts to private sector wage growth from 2019. Varga said the advertising tax would be reduced to zero until the end of 2022. The government wants to reduce the Small Business Tax (KIVA) rate from 13 percent to 12 percent from January 1, 2020. The measure would leave 5 billion forints with the some 40,000 businesses that opt to pay the tax, he said.