Internet tax: popular protests in Hungarian cities

About ten thousand people flocked to the streets in Budapest on Sunday evening to protest against the world’s first internet tax the government plans to implement in 2015. Police in riot gear lined up to protect the Budapest headquarters of the governing party Fidesz.

The website portfolio.hu quotes a local news portal saying that the new levy came totally out of the blue not just for the market players and the public, but even for Fidesz politicians themselves, for it was Prime Minister Viktor Orbán's idea. He wants to use the revenues collected this way to raise the wages for law enforcement and military personnel and for the officials of tax authority NAV.

Economy Minister Mihály Varga announced on Tuesday (October 21) that the telecom tax will be extended from next year to internet services, charging 150 forints for every gigabyte of internet data used. The new levy would be payable by the internet service providers.

After the announcement sparked outcry from the public and the telecom sector, the ruling Fidesz party’s caucus chief Antal Rogán said they might introduce a cap on the new levy.

Rogán said the party would find it useful if the tax had an upper limit "the same way and rate as it is prescribed in the tax law approved earlier for voice-based telephony."

"The drastic level of planned tax, up to 100 billion forints per year, threatens to undermine Hungarian broadband developments and a state-of-the-art digital economy and society built on it," Hungary’s leading telecoms group Magyar Telekom, the local unit of Germany’s Deutsche Telekom, told Reuters in an emailed statement on Wednesday.

(source: portfolio.hu)