Prime Minister Viktor Orbán, at a business conference, outlined measures that could support the recovery from the coronavirus crisis, including a tax rebate for lower income families, state-subsidised credit for SMEs and a higher minimum wage.
Orbán said the government was aiming for the deficit to shrink to 5.9% of GDP in 2022, down from 8.1% in 2020 and a projected 7.5% this year. He said full employment and the loan moratorium were key steps to avoiding the long-term economic effects of the pandemic. He said the government’s aim was to raise the minimum wage to 200,000 forints (EUR 575). However, a hasty hike could lead to SMEs breaking under the strain, as well as to layoffs and to growing numbers of jobseekers rather than full employment. The minimum wage hike would possibly happen in two phases, he said, alongside considerable tax cuts for SMEs. SMEs should also be offered measures balancing the interest rate hike and the phasing out of the NBH’s credit-for-growth scheme (Nhp), Orbán said. The new resources should be cheap, government-funded and carry interest below 0.5%, he said. Further, low-earning parents should be able to reclaim their 2021 PIT in 2022, Orbán said. The measure should come into force if economic growth reaches 5.5%, he said. The step would cost the budget 550-580 billion forints, he added.
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