Hungarian Govt Seeks To Make Public Utilities Non-Profit

  • 28 Jan 2014 8:00 AM
Hungarian Govt Seeks To Make Public Utilities Non-Profit
The government aims at building a public utilities sector in which all profits are spent on improving the sector’s services, state secretary for economy Zoltán Cséfalvay said on Monday. Cséfalvay, who is also the head of the national OECD council, spoke at a press conference at which OECD’s Hungary report was presented, and said that competition in Europe’s energy market was too low, and the monopolies were driving prices up. OECD Economics Department head Alvaro Pina said at the press conference that there was room for competition in the production of energy as well as in retail trade.

He added, however, that the Hungarian government’s utility price cut programme had a negative impact on the country’s competitiveness and was conveying a bad message to the economy. He argued that the liberalised energy market was contracting due to the cuts, prompting energy dealers to integrate, thus creating less competition.

OECD vice director Robert Ford said that Hungary’s special taxes should be gradually eliminated. Concerning OECD’s suggestion that Hungary would need a property and asset tax, Cséfalvay said that a large proportion of Hungarians were homeowners, and such a tax would weigh on low earners. “There is currently no room for such a tax,” the state secretary said.


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