“During the drawing up of the European Union’s climate strategy, one of the most important aspects is that the measures should not mean a disproportionately large budgetary burden for any member state and should not hinder economic growth”, Minister of Finance Mihály Varga declared at a meeting of EU finance ministers (Ecofin).

During the debate on the financial aspects of the European Green Deal, the Hungarian Minister explained: “Hungary agrees with the EU’s climate goals, but it must be made clear that an increase in energy and food prices cannot be a consequence of these, and that consumers must not be made to pay for the additional expenditure”.

Within the Green Deal, which sets down the EU’s new growth strategy and is aimed at the realisation of one trillion euros in sustainable development projects, a major role falls on the so-called Just Transition Fund. This is intended to assist the most disadvantaged regions during the transition to carbon neutrality, the Minister explained. “This is precisely why it is unacceptable that according to the allocation proposed by Brussels, Hungary would only receive a minimal share of the transition funding, just 1.2 percent”, he emphasised. “We need a made-to-measure incentives system”, Mr. Varga highlighted, adding that every member state has a different energy structure, and for instance in Hungary natural gas would replace the coal power plants that are based on more polluting technology, thus significantly reducing Hungary’s carbon dioxide emissions. The Minister expressed his concern that the development projects aimed at achieving this could be excluded from receiving funding, despite the fact that natural gas may be regarded as a useful tool during the course of the transition. “The idiosyncrasies of member states should also be taken into greater consideration: in contrast to the countries of Western Europe, where many people live in rented accommodation that belongs to enterprises, the majority of people in Hungary live in their own property, and accordingly the financial instruments being afforded to enterprises are not providing assistance towards the modernisation of homes”, Mr. Varga pointed out.

The EU finance ministers also touched on the topic of the taxation of the digital economy. “It is important that we should be able to tax digital companies in the same manner as if they were performing their activities within the traditional business model. However, Hungary strongly rejects plans to tax the profits of enterprises while disregarding their true business activities and existing international taxation standards”, the Hungarian Finance Minister told the press.