Karacsony said at the Republikon Institute gathering that it was not especially the political gridlock in the assembly or the fact it had been impossible to appoint a deputy mayor that was holding the city back, but rather that it was in the midst of an economic crisis and had fallen victim to a government policy of blackmail.

He said the city assembly was a battleground between its biggest factions, Fidesz and the Tisza Party, both of which exploited Budapest affairs to position themselves ahead of the 2026 general election.

Recent months had shown that "Fidesz votes no to everything", so decisions can only be made with the ten-member Tisza faction.

Karacsony said it would be hard to overcome the gridlock if local politicians focused solely on the city's affairs as even then "the lightning of national politics strikes above us".

MTI Reports: Govt county commissioner tells Karacsony to 'comply with law'

The government commissioner of Budapest has told the city's mayor, Gergely Karacsony, to comply with the law and desist from pushing through an "unlawful budget".

Botond Sara said in a video uploaded to Facebook that Karacsony should refrain from pressing ahead with his "next unlawful measure", accusing him of working to push an "unlawful budget" through the city assembly, saying "he doesn't want to pay the 50 billion forints" [EUR 121.3m] in solidarity tax "that poorer localities are entitled to".

"This is no solution to the municipality's plight, which is close to insolvency," Sara said. He said Karacsony was "playing for time" and this would worsen the city's already difficult situation. "Of course, we will challenge [any] unlawful decision."

In response, Karacsony said in a post on Facebook that a government office challenge against the Budapest budget would put the municipality's operations at risk.

"This means, no less, that the government wants to force the city into insolvency," he said.

He said the government office was running afoul of a municipal court decision that said "over-taxing Budapest is tantamount to confiscation". "The government insists on taxes which the Constitutional Court has said are contrary to the right of local authorities to financial autonomy enshrined in Hungary's Fundamental Law," he said.

Court Rules in Favour of Budapest Council in Lawsuit Over Solidarity Tax

A Budapest court has issued a binding ruling in favour of the city's administration in its lawsuit against the state treasury over the solidarity tax, declaring the previous tax collection orders unlawful.

The Budapest metropolitan council filed its lawsuit arguing that the amount of solidarity tax payable to the state treasury exceeded the funding it received from the government. The city council also said it had not been asked whether it approved the tax.

The state treasury had previously argued that the case only concerned its Pest County organisation, but the Budapest Municipal Court disagreed, saying the tax collection orders were issued and the related letters were sent by the treasury. The court annulled the treasury’s letters on the payment orders on the grounds that they were "non-existent administrative acts that suffer from fundamental formal legal deficiencies".

Commenting on the ruling, Budapest Mayor Gergely Karacsony said the court had made it clear that the state treasury had "unlawfully" charged the metropolitan council’s account.

He told a press conference that the treasury had to transfer 28.3 billion forints plus interest to the city council, otherwise they will take legal action. He noted that another lawsuit was pending on the 40 billion forints in solidarity tax that the city council paid in 2024, but there was "no doubt" after Tuesday’s ruling that the court would issue the same decision.
 

The Prime Minister’s Office said Karacsony was misleading the public with his remarks on the ruling, arguing that under the court’s decision, Budapest still had an obligation to pay the solidarity tax, which the state had collected from the metropolitan council.

The court has not ruled that the state had to pay back the tax, the office said in a statement, adding that it had merely pointed out a procedural error on the treasury’s part which the treasury had corrected.

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