Magyar Telekom: Hungary Government Should Revoke Planned Internet Tax

By Margit Feher

BUDAPEST--Hungary's government should revoke its plan to tax internet use from next year as it will be detrimental to service providers, internet users--individuals and companies alike--as well as to the public, the country's largest telecommunications company Magyar Telekom Nyrt. (MTELEKOM.BU) said on Wednesday.

Under its draft 2015 tax bill submitted to parliament on Tuesday, the government plans to impose a 150 Hungarian forint ($0.62) tax on every gigabyte of data used.

"Magyar Telekom supports the proposition of the industry players that the government should revoke its plan to launch the tax," the company said in a statement to The Wall Street Journal.

The plan is "drastic" and wasn't preceded by any consultation with the sector, Magyar Telekom added.

The tax may result in the internet providers paying as much as 100 billion forints ($414 million) a year in tax, which would make it impossible to develop broadband in Hungary and a modern economy built on the internet, the company added.

The new tax would be levied in addition to the special, telecom-sector tax telecom companies have already been paying since 2012.

Magyar Telekom is majority owned by Deutsche Telekom AG.

Write to Margit Feher at [e-mail]; Twitter: @margitfeher