András Tállai said that the left-wing tax system operating until 2010 encouraged the concealment of incomes and living off of benefits, and it took away the benefits introduced under the first Orbán government from those with children. After the change of government, the family tax system was launched, which has been helping working parents for 11 years, highlighted András Tállai.
On January 1, 2011, the new, simple, proportional family tax system came into force in Hungary, which recognizes two basic values: work and raising children while working. The new tax system provides significant financial support for working parents and families raising one or more children with the largest tax reduction in the last twenty years.
He reminded that the family tax system has expanded and become wider in the last 11 years.
It provides an increasingly significant discount to more and more people. As of January 1, 2014, the legislation was amended so that if the discount cannot be applied for any reason, it can also be used from the contribution to be paid by the individual. And with this extension of the discount, the situation of families with lower working income and raising more children improved significantly - stressed András Tállai.
As he said, between 2016 and 2019, the family discount for two children doubled in four equal steps compared to 2015.
The amount of the current discounts, expressed in tax, is HUF 10,000 per child for families with one child, HUF 20,000 for families with two children, and HUF 33,000 for families with three or more children, the state secretary pointed out.
He said that as of January 1, 2015, the discount for first married couples was introduced as a new tax base discount, which can be used together with the family discount from 2016. The discount can be applied for 24 months after the marriage, the amount expressed in tax is HUF 5,000 per month. That is, the family's net income increases by HUF 120,000 during this time.
András Tállai spoke about the fact that from January 1, 2020, the discount for mothers raising four or more children can be used, as a result of which the income earned by working women who raise at least four children during their lifetime is completely exempt from paying the tax.
The discount for young people under the age of 25 has been available since last year.
If a young person under the age of 25, who earns HUF 500,000 gross per month on average, in 2023 he can take home HUF 9,939 more per month and HUF 119,268 more per year thanks to the tax discount. From this year, the government will extend the SJ exemption to women who have children until the age of 30, he added.
The state secretary reminded: as part of family protection measures due to the epidemic, families raising children last year also received back the specified part of the personal income tax, simplified public contribution, and itemized tax of low-tax businesses that they paid in 2021.
The family tax refund could be a maximum of HUF 809,000, which both parents could receive
András Tállai said.
He explained that, thanks to the family tax and contribution discounts, in 2021, according to the last closed tax year data, more than HUF 310 billion remained with the families, and 900,000 parents in 830,000 families took advantage of the discounts.
In February of last year, the National Tax and Customs Administration issued tax refunds in the amount of more than HUF 611.3 billion to 1.4 million people as an advance, and after the submission of tax returns, an additional HUF 64.9 billion was allocated to individuals raising children, he explained.
András Tállai drew attention to the fact that the government extended the 5 percent VAT rate for the sale of new apartments by two years, until December 31, 2024, as a measure to stimulate the economy and to further help families create homes. In the framework of this measure, a transitional rule also ensures that in the case of ongoing, protracted housing constructions, this discount rate can also be applied until December 31, 2028.
The protracted war and the Brussels sanctions policy have now radically changed economic processes. The government's goal in this difficult situation is clear and unambiguous: to protect family benefits, emphasized the State Secretary of the Ministry of Finance.
MTI
Cover photo: MTI/János Vajda
