A farm ministry proposal on a new Land Act which would favour family farming over larger incorporated businesses could cause major damage in the sector, daily Nepszabadsag said on Wednesday.
Gabor Horvath, an agriculture expert, told the paper the move was tantamount to waging a war against agricultural business which would result in every second employee of an agricultural business losing their job within the next two years. This could mean 50,000 new unemployed, he said.
Horvath, who is General Secretary of the National Alliance of Farming Associations and Producers (MOSZ), said the draft?s measures could cut back agricultural production by 10-20 percent and increase the share of the grey economy from a currently estimated 30 percent to 40 percent. As a result, gross domestic product (GDP) could also drop by one percentage point, he added.
Horvath noted that farm businesses pay 100-150 billion forints (EUR 330-495m) into the budget in taxes and contributions each year, compared to revenues of 20-30 billion forints flowing in from family businesses.
MOSZ estimated that if the draft is adopted, the number of agricultural businesses could halve, replaced by family businesses, resulting in a 50 billion forint revenue drop for the central budget, he told the paper.
The economy ministry does not support the proposal put forward by the farm ministry, business daily Vilaggazdasag said on Wednesday, citing the ministry.
?The proposal is a concept which does not reflect the government?s position. The economy ministry does not support any motions to introduce a tax on wealth or property,? the ministry told the paper.
The draft of the land law published on the farm ministry?s website late May contains proposals to use fiscal means or taxation to curb speculation in land purchases, including the introduction of a progressive tax on wealth or land-related taxes, Vilaggazdasag said.
The farm ministry declined to comment to Vilaggazdasag.
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