Brutal, unexpected tax increase: the printing industry protests in an open letter to the minister

As they explain, the decision hits the industry completely unprepared and unreasonably damages business confidence in printed products. All this despite the fact that paper is one of the most recyclable materials of all advertising media, with a recycling rate of over 80% in Hungary, so the step cannot be justified on environmental grounds. For this reason, the measure completely ignores the basic principles of the Extended Producer Responsibility system, especially the principle of “reasonable cost”. It is no coincidence that nowhere else in the EU does an EPR system operate that would specifically “penalize” advertising paper ‒ since from the point of view of recycling, it does not matter what is written on the paper. Its EPR fees have so far been among the highest in Hungary, while in other European countries this price range is between 40-80 HUF.

The president of the Printing and Paper Industry Association, Katalin Orgován, who also registered the protest letter, pointed out that the measure, effective from October 1, will immediately increase the price of printing paper by 50-80%, which will not only have a direct inflationary effect, since the cost will ultimately be passed on to the population, but will also put large printing companies that work with their clients on the basis of annual agreements at fixed prices in an almost impossible situation. All this threatens thousands of jobs in the industry, and affects not only the segment, but also the older generation and pensioners, and those who primarily use paper-based communication, and who get their information from there. In practice, the decree will support businesses in neighboring countries, gray imports and the black economy, further putting honest domestic businesses that pay taxes at home at a competitive disadvantage.

The Association’s justification also states that the measure may be counterproductive from a fiscal perspective. The decision is ostensibly intended to increase MOHU’s revenues, but based on professional experience, printing orders will drop drastically with any such, even milder, measure. An increase of this magnitude is expected to result in a 40-50% decrease in orders, so it will not even mean additional income for MOHU. If, because of this, large clients permanently turn to digital channels, it will soon mean elimination for MOHU, while the advertising fees will fall not on domestic printing houses, but on large, international digital advertising networks, typically owned by foreign companies.