Hungary to raise minimum wage, impose new levy on above-average earners
Thursday, 22 September 2011 15:20
Hungary’s government will propose raising the minimum wage to 92,000 forints and the guaranteed wage minimum to HUF 108,000. It will also recommend a 5% wage hike in the private sector and promised to return part of the raises that are above the level agreed with social partners, the National Economy Ministry announced. The budget funds for the measures would be created by a "temporary contribution" payable by those whose gross monthly earning exceeds HUF 202,000. The flat tax system is to be revamped rather dramatically.
The changes announced last Friday affect not only the personal income tax regime but also the social security contributions, as the healthcare contribution will be raised by 1 percentage point. But it is not sure yet that the negative impact of that on the net income will be compensated. The ministry said this will be subject to negotiations.