Utility price reductions and spending on defence will feature within the economic policy in Hungary’s 2023 budget, as presented by the country’s Finance Minister, Mihály Varga.

On the presentation of the 2023 draft budget, the minister said the government’s fiscal policy is aimed at maintaining stability and bolstering balance indicators. Steps to boost revenue were paired with measures to reduce expenditure to lower the country’s debt and the deficit, he added.

The draft budget calculates with 4.1% GDP growth and a 3.5% of GDP target deficit. State debt is seen declining to 73.8% of GDP, and inflation at 5.2% for 2023.

“The draft budget contains a HUF 670 billion (EUR 1.7 billion) fund to preserve the utility price caps, and a HUF 842 billion (EUR 2.13 billion) defence fund,” the Finance Minister stated.

The former was set so the people of Hungary won’t have to “pay the price of the war and Brussels’ sanctions policy,” and the latter “because preserving Hungary’s peace and security is not subject for discussion,” he added.

Varga also said that Hungarians will not face additional burdens for the funds as they’ll be financed from windfall taxes on sectors reporting excessive profits in recent years.

However, the budget – the 13th consecutive budget for the Orbán government – is facing an uncertainty, “unprecedented since the economic crisis of 2008.”

The Hungarian government is committed to adhering to the values it had previously set, which include “independent, value-based politics and economic policy representing the interests of Hungary and Hungarians,” Daily News Hungary reports.

In addition, the country has emerged from the pandemic-fuelled health and economic crisis with a 7.1% rate of growth in 2021 and 8.2% in Q1 2022. The number of people in work in Hungary is at a record high and investments continue to grow, the minister went on to add.

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