Hungary and U.S. sign social security agreement

U.S. Ambassador to Hungary Colleen Bell and Hungarian Minister of Human Capacities Zoltán Balog has signed an agreement in Budapest regulating social security issues between the two countries and avoiding a form of double taxation for people.

According to the agreement, citizens will be eligible for pensions regardless in which country they have earned the right for it, while those citizens who only spent less than five years in the partner country will only have to pay contributions in their home country.

It will improve social security protection for people who work in both countries. Presently, some workers who divide their careers between the United States and Hungary fail to qualify for social security benefits from either country because they do not meet minimum eligibility requirements.

The agreement allows credits to be combined from both countries to qualify workers and their family members for pro-rated U.S. or Hungarian social security benefits.

“The aim of the agreement is to mutually increase the quality of life for citizens in both countries,” Zoltán Balog explained at the signing ceremony. He said it would benefit both Hungarians living in the U.S. and U.S. citizens living in Hungary. Balog also said that the agreement contains specific regulations for disadvantaged workers, benefiting about 10,000 people in the two countries.

“This is the culmination of six years of hard work and permanent consultations between the governments of the two countries,” Ambassador Bell said. “Such a high-level cooperation indicates mutual respect among our countries, as well as the joint desire to create a more transparent and sustainable business environment,” she added.

Before the Agreement can take effect, it must be reviewed by the U.S. Congress and the Hungarian Parliament.