Every little helps

„It's taken a while, but on Tuesday we learned how Hungary’s government plans to finance its way through the next few years. Ever since the country decided it could do without IMF and EU support three months ago, analysts have been wondering how Viktor Orbán, the prime minister, intended to meet the tight budget-deficit targets markets demand while fulfilling campaign promises to cut income tax and get his country growing again.

His answer, it turns out, is to impose «crisis taxes» for up to three years on primarily foreign-owned energy, telecommunications and retail companies, divert pension-fund contributions into state coffers and renegotiate all ongoing public-private partnership (PPP) contracts. (...)

While the bank tax upset Austrian and Italian banks and their governments, this new round of taxes spreads the pain across Europe. The telecoms tax hits the UK’s Vodafone, Norway’s Telenor and Germany’s Deutsche Telekom. (...)

Such politically well-connected foreign companies will certainly be turning to their own governments and to Brussels, who will ask whether the IMF’s conditions were really onerous enough to merit this all-or-nothing strategy.”