Hungary's incoming prime minister has vowed to reduce taxes significantly stating that current levels are crippling the country’s economy.
Viktor Orban, whose centre-right Fidesz party won a two-thirds parliamentary majority in a second round of elections, said the tax system must be aligned with those in neighbouring states to make Hungary competitive again.
"With the present system of taxation, the economy will suffocate ... this must be changed significantly," he told a new conference today.
Fidesz won 263 of 386 seats to give Mr Orban the strongest mandate of any Hungarian leader since the collapse of communism in 1989. The party was last in power between 1998 and 2002.
Hungarians and foreign investors hope Mr Orban will use that mandate to reinvigorate an economy that plunged into crisis in 2008, and was only saved from meltdown by a €20 billion loan from the European Union and International Monetary Fund (IMF).
The Socialists were last night predicted to take 59 seats in the next parliament – down from 186 seats in 2006 – and just ahead of the far-right Jobbik party with 47. Green liberal LMP has won 16 seats.
During the campaign, Mr Orban was vague about how he would manage the economy, but he pledged to cut taxes, slash red tape and crack down on corruption.
The commitment of the often populist Fidesz to cutting state spending is not clear.
Fidesz insisted that a strong mandate would allow it to govern effectively and thereby solve the problems that have fuelled the rise of Jobbik, an ultra-nationalist party that has entered parliament for the first time on pledges that include the need to stamp out "Gypsy crime".
Critics say the party, which claims to be patriotic, is actually racist and stokes the ethnic tensions that have led to a spate of fatal attacks on members of Hungary's Roma minority.
Additional reporting: Reuters
