This year the fund will be worth 800 billion forints (EUR 2.04bn), while next year it will reach 1,000 billion forints, he added. The details of the decision will be published in the Hungarian Gazette at the weekend, he said.

Nagy said the new tax on banks, energy and trading companies and airlines, among others, would be temporary and targeted.

Companies will be monitored to ensure that they don’t pass on the cost of the tax to consumers, he said.

Nagy said ministry budgets are being cut by 10%, with savings of 581 billion forints expected this year and 500 billion the next.

Also savings of 1,150 billion forints will be made in 2022-2023 by rescheduling and postponing certain public investments, he added.

Meanwhile, financial support packages will be focused on households, Nagy said, noting that local councils and businesses would no longer enjoy government subsidies.

Related savings are targeted at over 2,000 billion forints per year, with a view to hitting the budget deficit target of 4.9% of GDP this year and 3.5% in 2023.

Gov’t Pledges to Protect Families, Pensioners, Jobs in Hungary

The cabinet held a three-day away session in Sopron, in western Hungary, and adopted measures concerning the new “tax on extra profits” levied on large companies as well as the 2023 national draft budget.

It reviewed urgent tasks in connection with the protracted war in Ukraine and the threat of a global economic crisis, the prime minister’s press chief said.

“The goal is to protect families, pensioners, jobs, and the cap on household utility bills, while we will make large companies that have been accumulating huge profits recently contribute a large part of these to finance the cap of utility bills and protection funds,” he said.

The government is committed to meeting this year’s 4.9% deficit target and the 3.5% target for 2023, he added.

MTI Photo: Zoltán Balogh