The main difference compared TISZA program to the current Hungarian practice, is that till this time the budget balance has been achieved to a significant extent through inflation and consumption (VAT) revenues and sectoral special taxes, while TISZA wants to reach fiscal space from non-fiscal sources: but elimination of corruption, getting back of EU funds. The goal of the TISZA program is reducing taxes on labour and entrepreneurship and creating a fairer tax system.
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What does the TISZA program say about taxation? The path toward a fairer tax system
The main points of the program:
· the changing of the current flat rate structure of personal income tax
· introduction of wealth tax
· VAT policy does not include a general reduction in the rate, but targeted, measures to ease the cost of living
According to the program, the coverage of the costs of the measures will not come from a classic tax increase but
from elimination of corruption, unlocking the EU funds, improving financing conditions and wealth tax.
It is important, however, that the programme indicates directions, not draft legislation. The details of tax changes – and thus the substantive effects – will become known in the first months of government. You can read about the details in our newsletter.
