The performance of the Hungarian economy still does not show an improving trend.

Retail sales increased slightly, but in a multi-year comparison, it was 1457 billion forints in September 2022 and 1568 billion forints in September 2024.

Taking into account the rate of price increases between 2022 and 2024, which was 4% in 2022, then 25% in 2023, and is expected to be 3.5-4% in 2024 by experts, these figures mean that although the nominal value of purchases shows an increase, taking inflation into account, fewer products end up in consumers’ baskets.

The Hungarian economic development program considers it important to increase domestic consumption and, through this, the amount of taxes levied. To achieve this, it intends to increase retail turnover in 2025 and 2026 with the help of the following program:

A three-year wage agreement should be concluded with employee and employer representatives, as a result of which the average wage and the minimum wage may increase.

The employer side has already indicated that, in view of the performance of the Hungarian economy, it does not allow for further significant wage increases; to implement the published ideas, an annual growth of at least 9-10 percent would be necessary, but the possibilities do not allow for more than a 5 percent increase.

The increase in the minimum wage could be a problem mainly for small and medium-sized enterprises, because their efficiency does not even reach the level that would allow for a further increase in the minimum wage.

Forced wage increases may further increase unemployment and strengthen undeclared employment. Furthermore, performance-less wage increases may result in further inflationary effects, which may thus reduce the real wage amount.

According to the economic stimulus ideas, a worker loan program will be launched. The loan can be taken out from January 1, 2025; those aged 17-25 who have at least a 20-hour weekly employment relationship or business will be eligible, in the latter case the income only needs to reach the average income of those employed 20 hours a week;

The loan can be used freely, is interest-free, and has a maximum amount of 4 million forints.

Borrowers must commit to working in Hungary for 5 years.

After taking out the loan, the repayment obligation is suspended for two years after the first child is born, a further two-year moratorium comes with two children, and half of the outstanding debt at that time is waived, with the third child the entire outstanding debt is waived, the maturity is ten years, during which time it must be repaid in equal installments.

4 million forints with a ten-year repayment means 33,000 forints per month; taking out a bank loan of a similar amount can be achieved with a monthly repayment installment of 60-70,000 forints.

At the same time, 4 million forints is the price of a 6-8 year old medium-sized used car.

The undertaking of 5 years of work in Hungary can be realized if the government further increases the security of jobs and reduces tax-free irregular employment.

The economic stimulus plans include doubling the personal income tax benefits for families compared to the current level.

Currently, the tax benefit that can be used to offset personal income tax and social security contributions is, for example, 40,000 forints per month for 2 children, which is an amount that represents a tax base benefit of 266,000 forints per month, so to use this, a net salary of at least 266,000 forints per month is required; currently the minimum wage is 268,000 forints, but taxes still have to be paid from this.

The new economic policy program has set ambitious goals for itself, but the state of the real economy will determine the possibility of achieving the individual goals.