Erste Bank senior analyst Gergely Ürmössy said 1.8-2.0% inflation was realistic. At the same time, he said 2.5% GDP growth was too optimistic.

Commenting on the 2% budget deficit target he said it raised the question what other measures were planned in the background, considering that the economic growth would not directly provide the extra revenue to counterbalance a drop resulting from tax allowances.

ING senior analyst András Balatoni said ING projected slightly lower economic growth of 2.3% but the 2.5% was not unrealistic, either. Inflation could increase faster than the government expects, but this would have a positive effect on the budget, he added.

Radical nationalist Jobbik said it would cut taxes in other areas, namely in industry, agriculture and tourism. Jobbik said the government “devalues the work of the people” by trying to improve the country’s competitiveness through cheap labour, while other countries are investing in skilled labour.

The Socialist Party said people expected the new budget to allocate more funds to health care, social security, education and to local councils. It said single rate of personal income tax was unfair and hampered Hungary’s economic growth.

Green opposition party LMP said the government’s proposed tax cuts would only benefit high earners without meaningfully improving the situation of those with lower incomes.

The opposition Dialogue for Hungary (PM) party said the budget proposal would further widen the country’s income gap. PM said the budget should be the “budget of the minimum wage”.

Source www.hungarymatters.hu

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