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Hungary Adopts 'Hamburger Tax'

by Ulrika Lomas,, Brussels

18 July 2011

Eager to generate additional tax revenues and to reverse increasingly unhealthy dietary trends, the Hungarian parliament, where Prime Minister Viktor Orban’s conservative party currently holds a two thirds majority, has recently voted in favour of a new tax on unhealthy foodstuffs. The bill was approved by 255 votes to 54, with 36 abstentions.

Dubbed the ‘hamburger tax’ and primarily targeting biscuits, energy drinks and pre-wrapped cakes, the new levy is to be imposed on food and drink in Hungary with a high sugar, salt, caffeine, or carbohydrate content from September 1.

In accordance with the provisions contained in the bill, a tax of HUF5 (EUR0.02) per litre will be levied on high sugar drinks, of HUF250 (EUR0.92) per litre on so-called energy drinks and of between HUF100 and HUF200 (EUR0.37 and EUR0.74) per kilogram on biscuits and cakes.

Defending the proposal back in March when it was first mooted, Hungary’s Economy Minister György Matolcsy argued that studies conducted over the past few years into the dietary habits of the population and the effects on health have shown that problems linked to excessive fat and salt consumption have increased.

The Hungarian government has already clearly demonstrated that it is highly creative in its taxation of specific sectors of the country’s economy to increase tax revenues. Last year, the decision was taken to impose a highly controversial annual bank tax on the balance sum of the country’s banks in 2010 and 2011, and to extend the 8% exceptional crisis tax, imposed on certain energy companies since 2009, to telecommunications operators and to commercial retail chains in Hungary.

TAGS: tax | Hungary | food | retail

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