Saying that he had found the information in an obscure part of the cabinet’s medium-term economic plans, which were attached to the 2011 budget draft, Kopits noted that the plan is not consistent with government statements to date, and accused the cabinet of a lack of transparency.

His comments, later confirmed by prime Ministerial spokesman Peter Szijjarto, triggered a huge sell-off on the stock market.

Kopits said some revenue items in the government’s medium-term projections show that the government is counting on revenue from the special taxes in both 2013 and 2014, two years beyond the announced expiry date.

The government has included annual revenue of Ft 85 billion from these taxes and Ft 93 billion from the bank tax, approximately half the current levels, in 2013 and 2014.

The government also expects to receive Ft 29 billion from the Robin Hood tax on energy company profits in 2013 and 2014, according to supplements of the budget bill later released by the government.

There are also discrepancies in the long-term budget plans on the use of private pension payments, Kopits noted. The government plans to spend Ft 530 billion of the funds obtained from expropriating private pension fund payments next year, a figure which assumes that 90% of private pension fund members will return to the state scheme.

Kopits said it is not clear whether these funds will be used to reduce state debt or the social security fund deficit in the medium term.

Debt service costs will not decrease significantly over the next few years, Kopits pointed out, despite the government’s earlier statement on plans to sharply reduce the state debt. Debt service costs will fall only slightly from Ft 1,153 billion in 2010 to Ft 1,028 billion in 2014.

The extraordinary bank levy and crisis taxes will expire in 2012, to be replaced by a “new system”, prime ministerial spokesman Szijjarto said yesterday, after Kopits revealed the budgetary supplement of the government."

Source: Hungary Around the Clock.

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