EC slams Hungarian telco tax

The European Commission (EC) has ramped up the pressure on Hungary over its controversial telco tax.

Several reports indicate that the infringement proceedings it previously initiated have been taken to the next stage, with the EC now calling for the tax to be amended within two months.

Failure to do so could see the country being hauled up before the European Court of Justice.

In the EC’s view, the telco tax is discriminatory in that it affects mostly foreign-owned companies. One is the incumbent telco Magyar Telekom, which is backed by Deutsche Telekom.

Earlier this week it announced that parliament had adopted an act imposing tax on utility networks, effective from January 1 next year and for an indefinite period.

This additional tax could cost the telco between HUF9-11 billion (€32-39 million) a year.