Around 1,000 protesters blocked a bridge in central Budapest today as Parliament debated a proposal by Prime Minister Viktor Orban’s government that would raise the tax rate for hundreds of thousands of small businesses.
Protesters first gathered in a central square outside the Parliament before marching to a nearby Danube bridge, blocking traffic in both directions between the two parts of Budapest in the presence of a heavy police presence.
Nationalist Orban faces his toughest challenge since coming to power in 2010, with inflation at its highest level in two decades, the forint falling to record lows and European Union funds on the brink ‘ amid controversy over the country’s standards of democracy.
With the bridge closed for about an hour, blocking one of Budapest’s main thoroughfares, protesters chanting “take it down” were confronted by police who asked them to leave the scene.
“It’s probably not worth it to continue (with the higher tax rate),” said Katalin Karolii, 52, who owns a small nutrition consulting business. “It’s going to jeopardize my livelihood, the livelihood of my whole family.” .
Orban’s government submitted the amendments to Parliament yesterday, drastically reducing the chances of qualifying for a more simplified tax regime, which many small businesses had opted for because of the low tax rate it offered.
However, the government claims that some businesses abused the system, forcing workers into the scheme to reduce their own costs, thus facilitating a form of ‘undercover’ work. The new rules, if approved by Parliament, are expected to come into effect in September.
Laszlo Zara, a tax expert, said that it is estimated that the changes affect 400,000 to 500,000 small businesses and may lead the vast majority of these companies outside of this regime.
“It’s clearly a tax increase, any way you try to present it, a very large tax increase,” he said. “It will be inflationary because (small businesses) will not be able to reach their previous levels of income, which will force them to raise prices, increasing inflation at the same time.”
SOURCE: AMPE
Source: Capital
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