Hungary's Orban is preparing 2022 vote with wage hike, tax handout to families

Photo: EPA Hungary PM Viktor Orban speaks to the media after his meeting with British Prime Minister Boris Johnson in London, 28 May 2021.

Hungary's populist premier flagged a hike in the minimum wage on Thursday and reaffirmed plans for a large tax refund to families in 2022, launching his campaign for next year's election that is shaping up as a competitive race for the first time in a decade, Reuters reports.

Prime Minister Viktor Orban, a right-wing nationalist, has scored three successive landslides since 2010, when he took office, but opposition parties have united against his Fidesz party for the first time and caught up with it in opinion polls.

On Wednesday Orban announced a big personal income tax refund to families with children worth over 550bn forints ($1.9bn) early next year, if economic growth reaches at least 5.5% this year.

Earlier he had declared that people younger than 25 will not have to pay personal income tax from next year.

Orban said on Thursday the government would launch a national consultation on the restart of the economy after the coronavirus pandemic. This is a questionnaire sent out to citizens, paid for from the state budget, which has served as a popular campaign tool for Orban for many years.

"I would like to confirm that...we will undertake the task of raising the minimum wage to 200,000 forints ($700) per month in one or more steps," Orban told a news conference.

He said small businesses would have to be compensated with tax cuts to be able to finance this wage hike. The minimum wage is currently at 167,400 forints.

A poll taken last month by think tank Republikon showed a neck-and-neck race between Fidesz and the joint opposition party list. Fidesz was commanding 32% of all voters, just shy of the 33% backing for the six-party opposition platform.

Orban, who has been campaigning on the back of a mass COVID-19 vaccine rollout which has so far inoculated about 55% of the population, is betting on a fast economic rebound now to help his re-election bid next year.

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