Hungary’s government must scale back
its generous system of public benefits and simplify its tax system
before it can cut taxes, Prime Minister Ferenc Gyurcsany told the
press on Friday, ahead of government and Socialist party session in
the mountain resort of Dobogoko (N Hungary).
"The tax system needs to be simplified, and one of its
conditions is to streamline tax exemptions," Gyurcsany said.
The Welfare Ministry aims to provide the conditions for
guaranteeing job-seekers 120 hours of paid work each quarter, he
said. Employers providing such jobs are expected to come from the
private sector as well as local councils, he added.
The whole welfare system needs to be revamped, including the
system of benefits, Gyurcsany said. He added that the universal
entitlement to child benefits will stay unchanged, although a
proposal suggesting some of it could be paid out in vouchers should
be considered.
Gyurcsany noted that the whitening of the economy has proceeded
at a faster pace over the past two years than originally
anticipated. The number of tax-paying companies doubled between 2005
and 2007 and the number of loss-declaring firms fell by a third,
Gyurcsany said, citing figures from tax office APEH.
