The Economic Protection Plan, the Action Plan to Reboot the Economy and the successful vaccination program have created the opportunity for the Hungarian economy to return to a dynamic growth path above the EU average this year, the Ministry of Finance announced.
According to the Convergence Program, the country’s Economic Protection Plan provided the economy, businesses, families and workers with significant resources. The document also provides information on the government’s economic policy objectives and macroeconomic and budgetary developments, in particular, the effects of the coronavirus crisis and specific economic policy responses.
The government has announced the start of the Action Plan to Reboot the Economy based on the results of the Economic Protection Plan whose measures will support the growth of the Hungarian economy in the long run. In addition to fiscal incentives to increase investment and competitiveness, more than EUR 40 billion from the new EU funds will be available to Hungary in the period 2021-2027.
Growth will be further supported by reduced taxes on labor and businesses, the increased efficiency of tax collection and the simplified tax system, the Ministry of Finance stated.
The government expects growth of 4.3 percent in 2021 and 5.2 percent in 2022, after which the Hungarian economy may expand by more than 4 percent annually. The document assumes a deficit of 7.5 percent by 2021, followed by a steady decline for the following years. Hungary’s public debt may decline further as well, with the report projecting a decline to 73.1 percent of gross domestic product by 2025.