Economic development minister informs Banking Association on decision to cut extra profits
Orbán: Government to protect utility cuts, cut excess profits
The new funds will finance the government’s public utility cut programme and development projects for the military, Orbán said. He added that the new measures would apply for 2022 and 2023.
Orbán noted the government’s commitment to protecting “families, pensioners, jobs and utility cuts even in a protracted war situation”. He added that the protracted war and the EU’s sanction policy, which “shows no improvement”, would together result in “drastic price hikes”. While the utility cut programme provides protection to families, that protection is “ever harder and more expensive to maintain” in light of increasing energy prices, he said.
Orbán said the military should be reinforced with no delay.
Meanwhile, he said, banks and international companies earned excessive profits through higher interest rates and prices.
“We are asking and expecting those that make excess profits in this situation of war to help people and contribute to the country’s defence spending,” he said. He added that the government would publish detailed figures on Thursday.
Economic development minister informs Banking Association on decision to cut extra profits
Economic Development Minister Marton Nagy has informed the Banking Association about the government’s decision to strip several sectors, including banks, of their extra profits. In a statement, the minister said “we are in extraordinary times… which call for extraordinary measures”.
Right after the coronavirus pandemic and amid energy prices rising at an unprecedented pace the world is facing an economic crisis, while Hungary must work to stay out of the war in Ukraine and protect the financial security of families, Nagy said.
The government is seeking to ensure the necessary room for manoeuvre through a broader distribution of the public burden, the minister said. The government has established that banks, through a higher base rate and low retail deposit rates, are “earning outstanding or extra profits”, the minister said, adding that an extra profit tax would be introduced for a two-year term.
The government is committed to reducing the state debt and the budget deficit, increasing economic growth and protecting “the social achievements of the utility cut programme”, Nagy said.
