Hungary May Scrap Income Tax  for Women With Three Children

(Bloomberg) --

Hungary’s leader is pushing to scrap personal income tax for women with at least three children, expanding a policy currently available to mothers of four or more.

The move is part of increasingly aggressive efforts by Prime Minister Viktor Orban’s government to boost both the economy and birth rates. Eastern Europe has one of the lowest fertility rates in the world, with the labor force of the 21 countries between the Baltic Sea and the Balkans projected to shrink by more than a quarter by 2050, according to the International Monetary Fund.

The cabinet is still debating whether it has fiscal room, Orban told reporters on Thursday in Budapest. He said he’d announce details of an economic stimulus package focused on families in February.

The tax cut would be the latest in a string of measures aimed at promoting childbirth and helping young families, including subsidies for building homes and buying cars and interest-free loans for people planning to have children.

It’s also part of Orban’s nationalist agenda, with the government reluctant to address an acute labor shortage with immigration, out of concern that it’d imperil the country’s Christian heritage.

In 2016, Hungary had 2.74 million registered families, of which 211,066 had three or more children, according to a census from that year by the Statistics Office. Last month, the government announced the nationalization of private fertility clinics and vowed to make treatments free to all citizens from February.

To contact the reporter on this story: Marton Eder in Budapest at meder4@bloomberg.net

To contact the editors responsible for this story: Alex Nicholson at anicholson6@bloomberg.net, Zoltan Simon, Michael Winfrey

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