The Hungarian government is working to consolidate its relationships with banks. Concrete steps in that direction will be taken after András Simor steps down as head of the National Bank in March. Banks will likely to be given substantial tax breaks if they help stimulate the economy through active lending, according to State Secretary Gyula Pleschinger. The Economy Ministry is calculating how large a tax break would be given to banks if they agree to step up lending. No formal decision has been made yet. An unnamed source from the ruling FIDESZ party, however, said that in extreme cases a bank’s taxes could be slashed by as much as 70 percent.
