(Bloomberg) -- Hungarian assets were hammered after Prime Minister Viktor Orban announced plans to impose windfall taxes across the economy to shore up the budget.
Hungarian refiner Mol Nyrt. plunged almost 15% while OTP Bank Nyrt., the country’s largest lender, fell more than 13% on Thursday before paring losses. The forint came near a record low against the euro as it weakened 0.8% after a 2.6% plunge on Wednesday. The central bank kept its key interest unchanged at 6.45% this morning.
In a video message on Wednesday evening, Orban said that this year and next he seeks to take “the bulk” of what he called the “extra profits” in sectors including banking, insurance, energy, telecommunications, large retail and airlines in order to fund utility price cuts and cover the cost of modernizing the armed forces.
Details of the tax plan will be unveiled at a government briefing starting at 2:30 p.m. in Budapest. The fresh financing will help consolidate the Hungarian budget as the European Union imposes an effective funding freeze against Orban’s government, which it accuses of flaunting European norms.
©2022 Bloomberg L.P.