He told a press conference held jointly with Elek Nagy, president of the Hungarian Chamber of Commerce and Industry (MKIK), that the cooperation between the government and the chamber of commerce had now brought significant results, and he expressed his gratitude for the agreement previously concluded with the chamber.

"Today we hear mostly bad news about the European economy", he said, adding that Europe's competitiveness was declining and there were no plans to improve it. "We are seeing a defensive, shrinking, hedgehog-like European economic policy," he said.

He cited sky-high energy prices, the Ukrainian-Russian war, and the related economic disputes about how much money should be given to Ukraine, where this money should come from, and whether this money would be better spent in the European economy.

He said that this was not good for a country that not only wanted to protect what it had achieved but also wanted to develop further.

He said the government's economic strategy was based on four pillars: a 3 percent loan for home ownership, a similar loan for businesses, tax cuts for families, and tax cuts for businesses.

"We have now discussed the second pillar: how we can provide Hungarian businesses with loans that are easy to access, provide them with significant assistance, are not bureaucratic, can be used freely, have a fixed interest rate, so that taking them out does not pose an unforeseeable risk to businesses, and they are delivered to entrepreneurs through a well-trodden path, because a mechanism is already in place," he said. "In practice, this means that from Monday, we will reduce the interest rate on all loan products available with the Szechenyi Card to 3 percent," he added.

Orban said this was great help primarily for SMEs, as it can be applied for in a flexible manners and used freely.

In response to a question concerning the budgetary impact of the program, he said that 250 billion forints would be spent this year to support the Szechenyi Card system, together with the new credit facility, and 320 billion in 2026, of which approximately 60 billion would be for the fixed 3 percent loan.

Concerning the timing of the program, he said at the beginning of the year he had talked about a flying start, expecting that the new US President Donald Trump would quickly achieve peace, which would change the economic environment. But after the US president's attempt at peacemaking failed, everything had to be rescheduled, he added.

"The flying start has happened, but not from January 1, but from July 1," he said.

Orban said July 1 was the date when tax exemptions for child care and child raising allowances and a 50 percent increase in family tax credits were introduced, as well as subsidies for businesses. He added that the isssuance of vouchers payable to pensioners was postponed until October.

He said rescheduling of measures was not the government's responsibility, but rather the result of the international situation, as the war developed in such a way that they were unable to start with the programme in January.

When asked whether the government would revise its GDP growth forecast after the Hungarian National Bank lowered its forecast for this year to 0.6 percent, the prime minister said they did not plan to revise it, as it was now October and "close to the end of the year."

Concerning whether it was worth revising the 2026 forecast, he said they were considering it, but no decision had been made. He said he had asked the finance minister to pursue an economic policy that would deliver the 3.1 percent growth recently announced in the budget. "So we are fighting for 3.1 percent growth. We don't want to lower the bar, we want to keep it high. We would rather train harder so that we can jump higher," he said.

In response to a question about the opposition Tisza Party's tax plans, Orban said there was a lot of confusion surrounding this issue because politics and the entertainment industry had become intertwined, making it difficult to know what to take seriously and what not to.

He added that it was not possible to talk sensibly about these issues in a situation where the essence of Tisza's publicly stated political strategy was not to reveal what they were planning to do after the election, because then they would lose the election.

At the same time, he said, the Hungarian opposition had long wanted what Brussels wants, and Brussels expected Hungary to abolish the flat tax, raise taxes on businesses, reform utility price reductions, and eliminate the 13th month pension.

"I am not basing my opinion on what one or another Hungarian opposition party says, but on what their masters say," he said.

He said that Hungary currently had the best functioning tax system in Europe, with the lowest taxes on labour and the second lowest tax rate for businesses in Europe.

He said the underlying structure of the Hungarian economy was completely different from that of Western European economies: Hungary has a labor-based economy, while Western Europe has transformed into a welfare society with an aid-based economy.

He said taxes should only be reduced, never raised, because that would be bad for everyone in Hungary.

 

Source: MTI – Hungary’s national news agency since 1881. While MTI articles are usually factual, some may contain political bias, and readers should be aware that such content does not reflect the position of XpatLoop, which is neutral and independent.

Since the goal of XpatLoop is to keep readers well briefed, right across the spectrum of opinions, MTI items are shared to ensure readers are aware of all narratives within the local media.

XpatLoop believes in empowering readers to form their own views through complete and comprehensive coverage. To facilitate this XpatLoop has a balanced range of news partners, as you can see when you surf around XpatLoop.com

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