OECD Environmental Performance Reviews: Hungary 2018 by OECD

Author:OECD
Language: eng
Format: epub
Tags: Finance and Investment/Governance/Environment
Publisher: OECD Publishing
Published: 2018-06-27T16:00:00+00:00

Figure 3.2. Revenue from environmentally related taxes is high in international comparison

StatLink http://dx.doi.org/10.1787/888933712434

Hungary could further boost environmentally related taxes and charges, and regularly adjust their rates, including for inflation. It could also improve design of these taxes and charges to maintain their ability to provide incentives for more efficient resource use and to raise revenue. This could also help the government achieve its goal of bringing the debt-to-GDP ratio down to 50%. While Hungary has made progress in reducing the public debt, it remains high compared to most other Central and Eastern European countries (OECD, 2016a). Public spending is high (half of GDP) with a large share going to general public services. According to OECD (2017a), fiscal policy should re-prioritise public spending towards infrastructure investment that supports productivity growth. Investment in infrastructure, education and health (among others) requires high spending, but the government aims to reduce taxes on labour and businesses. As a result, additional and less distortive revenue sources such as environmentally related taxes may be needed.

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