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Hungary PM launches election campaign with $2 billion tax refund for families

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By Reuters
Hungary PM launches election campaign with $2 billion tax refund for families
Hungary PM launches election campaign with $2 billion tax refund for families   -   Copyright  Thomson Reuters 2021   -  

<div> <p>By Krisztina Than and Gergely Szakacs</p> <p><span class="caps">BUDAPEST</span> -Hungary’s government will refund $2 billion of income tax to families in early 2022 and also plans a big hike in the minimum wage, right-wing Prime Minister Viktor Orban told the opening session of parliament on Monday, setting the stage for next year’s election.</p> <p>Orban, who faces a parliamentary election that is shaping up as a competitive race for the first time in a decade, said the economy’s sharp rebound from the coronavirus pandemic provided room in the budget for the measures.</p> <p>Hungary raised about 4.4 billion euros on international markets last week in a surprise bond issuance to help cover rising spending and a likely delay in the arrival of European Union <span class="caps">COVID</span>-19 recovery fund money due to a row between Brussels and Budapest over gay rights and media freedoms.</p> <p>Orban has already showered the electorate with handouts, including generous home-renovation grants, and last week extended a moratorium on loan repayments for vulnerable groups until mid-2022.</p> <p>He said the economy was set to grow more than 5.5% this year, and that there was already a shortage of labour.</p> <p>The government will issue the tax refunds to all families next February. The payments will be capped at the level of income tax paid by someone earning the average wage.</p> <p>“In total, the tax authority will refund 600 billion forints ($2 billion) to 1.9 million parents,” Orban told parliament, importing an electoral recipe from his Polish allies, the populist and nationalist Law and Justice (PiS) party.</p> <p>Poland’s ruling party had introduced a scheme giving families 500 zlotys per month for each child and also exempted most people aged under 26 from the obligation to pay income tax.</p> <p>Orban reiterated that an exemption from personal income tax for those under 25 will come into force next year.</p> <p>Pensioners will also get an extra payment due to rising inflation, he said.</p> <p>He flagged a hike in the minimum wage to 200,000 forints from 167,400 forints currently, saying that talks with employers were under way and that there was a “good chance” of an agreement.</p> <p>Opposition parties said the wage hike had been long overdue, and sharply criticised the government for what they said was rampant corruption, surging prices and a widening wealth gap.</p> <p>“Three things have grown in Hungary….your luxury, the size of yachts and poverty,” said Peter Jakab, leader of the opposition Jobbik party. “Prices are sky high.”</p> <p>According to four opinion polls conducted in August, Orban’s Fidesz and the broad alliance of opposition parties are running neck-and-neck. The election is expected to be held by next spring, although no date has been set yet.</p> <p>Orban, who has grown increasingly radical on social policy to protect what he says are traditional Christian values from Western liberalism, reaffirmed his support for a law that EU leaders say discriminates against gay and transgender people and goes against EU values.</p> <p>The law, passed in June, bans the “display and promotion of homosexuality” among under-18s.</p> <p>“We do not allow room for any kind of sexual propaganda targeted at children,” Orban said. ($1 = 301.8200 forints)</p> </div>