Budapest left out of revenue compensating COVID-19 funds

Budapest and all districts of the Hungarian capital were excluded from the €64 million (HUF 23 billion) in state support meant to alleviate the budgetary pressure caused by the government’s decision to support businesses struggling with the pandemic-induced economic hardships by halving the local business tax last December, which goes to local governments’ coffers. [Shutterstock/Anamaria Mejia]

Budapest and all districts of the Hungarian capital were excluded from the €64 million (HUF 23 billion) in state support meant to alleviate the budgetary pressure caused by the government’s decision to support businesses struggling with the pandemic-induced economic hardships by halving the local business tax last December, which goes to local governments’ coffers.

The government will compensate 27 municipalities with more than 25,000 inhabitants performing “worse-than-average financially”. The governments reasoning for skipping the capital is that Budapest’s economic performance is twice the national average, and its development is 151% of the EU average and has significant reserves.“It wasn’t as if I expected something else, but the government again failed to keep its word,” the capital’s green mayor Gergely Karácsony, responded to the announcement on Facebook.

Moreover, the amount €64 million allocated to the 27 local governments is small compared to even to the fact that “Budapest alone was deprived of more than HUF 31 billion (€86 million)  in revenue by the December decision” to cut the tax, added Karácsony, who is expected to run for the prime ministerial candidacy of the united opposition.

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