KATA: President Approves Controversial Changes to Small Business Tax Law in Hungary

  • 19 Jul 2022 9:02 AM
  • Hungary Matters
KATA: President Approves Controversial Changes to Small Business Tax Law in Hungary
President Katalin Novák on Monday signed into law the amendments to the tax for small business owners (KATA). The legislation prompted protests in Budapest last week.

In a statement, Novák said she had found no reason to refer the law to the Constitutional Court, and “the legislator’s intent is hardly disputable”.

At the same time, “the outrage is palpable,” and many have difficulties in adapting swiftly to the new situation, she said.

“I can understand they have questions. It would have been better to decide on the amendments after substantive consultation with the interested parties,” she said.

“I have talked to the prime minister and the cabinet, and obtained a promise that the detailed regulations will provide answers to legitimate questions,” she said.

In these extraordinary times, Hungary’s security is based on budgetary stability, she said. “Cooperation, mutual responsibility and understanding will help us through the worst of it. That is the only way to stay standing,” she said.

Protesters Block Margaret Bridge

Demonstrators protesting changes to the Itemised Tax for Small Businesses (kata) and caps on household energy bills blocked Margaret Bridge in Budapest on Monday morning.

The few hundred demonstrators, most of whom arrived by bicycle or scooter wearing the shirts and backpacks of food delivery companies, first filled only the outer lanes of the bridge, before blocking the entire bridge from the Pest side near Jászai Mari Square by 8am, MTI’s correspondent reported.

Budapest police (BRFK) said on their website that traffic going onto Margaret Bridge would be diverted.

Cars that were already on the bridge before it was fully blocked by the protesters were able to turn around on the tram tracks.

The sidewalks and bicycle paths on the bridge remained accessible. Budapest police said on its website police.hu at 9am that the event announced to police in advance had ended while the demonstrators were still blocking the entire bridge. Police afterwards instructed the demonstrators to clear the tram tracks and the road.

A group of protesters meanwhile left the bridge in the direction of Nyugati Railway Station and the Oktogon junction on the Pest side.

MTI’s onsite correspondent said that groups of police officers moved onto the bridge from both ends and cleared demonstrators from the road and herded them onto the sidewalk.

They also pulled some protesters from the crowd. Budapest police said at 11am that vehicle traffic had resumed on the bridge in both directions.

They later said that “police took into custody five people who had refused to move to the sidewalk despite repeated calls to do so”.


MTI Photo: Gergely Botár

Related links

Colling Finance Insight: 'Life After KATA Changes'

  • How does this content make you feel?

XpatLoop Media Partner

Hungary Matters

Launched in January 2014, this newsletter published on week days covers 'everything you need to know about what’s going on in Hungary and beyond', according to its publisher the state media agency MTI.

  • Hungary Scrutiny: Visiting Committee has Serious Concerns about Unlocking EU Funding

    Hungary Scrutiny: Visiting Committee has Serious Concerns about Unlocking EU Funding

    • 18 May 2023 7:06 AM

    The delegation of the European Parliament’s Committee on Budgetary Control called on the Hungarian government to act more responsibly in distributing EU funds, include regional authorities in decision-making instead of a “top-down” approach and meet the criteria required for releasing the funds withheld from Hungary, the head of the delegation told a press conference.

  • Hungarian Opinion: Tug-of-War Over EU Funding

    Hungarian Opinion: Tug-of-War Over EU Funding

    • 13 Dec 2022 10:11 AM

    A left-wing columnist accuses the Hungarian government of trying to unlock EU funding by threatening to veto key EU decisions. A pro-government analyst, on the other hand, accuses the EU of blackmailing Hungary.

  • EP Votes to Recommend Freezing Hungary Funding

    EP Votes to Recommend Freezing Hungary Funding

    • 25 Nov 2022 9:41 AM

    The European Parliament has proposed freezing European Union funding, saying that the 17 measures taken by Hungary aimed at unlocking its EU funding were not sufficient to offset the systemic risks to the block’s finances.