Tax policy

In the Hungarian Parliament’s early summer session the new government announced their proposal to cut the VAT on long shelf life milk and increase the rate of the public health product tax (NETA). From 2019 the tax on soft drinks, crisps, chocolates and alcoholic drinks would be 20 percent higher on average.

According to data from the National Tax and Customs Administration (NAV), the biggest NETA revenue is generated by pre-packaged products made with added sugar, salty snacks and certain soft drinks.However, the majority of their buyers are families with children. What is more, it hasn’t been proved since the introduction of NETA that higher prices reduce demand for these products and that product compositions are now healthier.

The Federation of Hungarian Food Industries (ÉFOSZ) and the Hungarian Chamber of Agriculture (NAK) have already published a statement, protesting the higher NETA rate and complaining about the government not consulting with them before making the proposal. They want the government to postpone the measure and start talks with them about the issue. //