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Hungary Might Be Affected
By The Cyprus Wealth Tax




Hungarian businessmen and firms hold large sums of money in Cypriot accounts.

The Hungarian press approximates that over 1,500 Hungarian companies own deposits in Cypriot banks. Additionally, there are numerous off-shore Hungarian-owned companies that are headquartered on the Mediterranean island.

The total amount of Hungarian-owned money is substantial - about 1 billion euros worth (considering Hungary's GDP and population, this is a substantial amount).

Indirectly, Hungarian firms will certainly be affected by the wealth tax.

According to the latest proposals, the deposit tax will eventually be transformed - only accounts of over 100,000 euros will be taxed, but with 40 % (more than quadruple the initial 9.9 % proposed tax).

Important Hungarian firms hold their funds in Cyprus and their vast majority might indeed fall into the "taxable" category.
It is still not known exactly which firms and how much money they hold on Cyprus, but there are speculations saying that some of the country's major companies are involved. A major loss of funds would affect their productivity in Hungary.

At the start of the Cyprus bank taxation hysteria, the Hungarian forint already responded by losing value. It eventually gained since then.

Nevertheless, Hungary's already suffering economy will be directly affected by the wealth-trimming that's being prepared in Cyprus.





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