- The Washington Times - Tuesday, January 16, 2018

Hungary’s Minister of Foreign Affairs and Trade on Tuesday said that in addition to associated economic benefits from his own country’s recent tax reforms, Hungary’s marriage and fertility rates have also increased since the initial changes were approved.

Minister Péter Szijjártó said that over the last eight years — since lawmakers there started to pass a series of individual and corporate tax cuts — marriages are up 40 percent and the fertility rate is up 17 percent.

“With the tax exemptions, if you raise three kids and you earn around the average, you basically [won’t] pay anything in personal income,” Mr. Szijjártó said at an event in D.C. hosted by the Embassy of Hungary and Americans for Tax Reform.

Starting in 2010, Hungary passed a series of tax reforms that involved lowering the personal income tax rate to 15 percent and the corporate tax rate to 9 percent.

The 16 percent personal rate is the lowest among European Union countries, and the 9 percent corporate rate is the second-lowest.

A major part of the recent tax debate in the U.S. involved how to make the tax code more family-friendly.

Sens. Marco Rubio and Mike Lee, among others, pushed for an expanded child tax credit to try to give a boost to working families with children.

Lawmakers also tried to do away with the “marriage penalty” in the tax code that effectively punishes many joint filers, managing to do so on income taxes for all but the highest earners.

Rep. David Schweikert, also speaking at the event, said lawmakers had to find a balance between enacting policies that would generate economic growth and items that would help secure enough votes.

He said items like the family and child credits were viewed favorably by the public, but wouldn’t necessarily produce a ton of economic growth compared to other parts of the $1.5 trillion package.

“You’re saying, this is really good for our future — what tax policy creates that economic growth, but also what tax policy gives you the votes so it passes?” said Mr. Schweikert, Arizona Republican.

The event was meant to compare the reforms in Hungary to the $1.5 trillion tax-cut package recently passed by Congress, which lowered the U.S. corporate rate from 35 percent to 21 percent and lowered individual rates as well.

Mr. Szijjártó said it took about three or four years to see a “clear, positive impact” from the reforms and that the positive feedback led to more cuts, including a reduction from a new 16 percent personal income tax rate to 15 percent in 2016.

“This is an eight-year-long story,” he said.

Mr. Szijjártó said since the initial 2010 reforms, lawmakers also had to go back and make some temporary changes to make sure that people who had been in the “zero bracket,” with no income tax liability, weren’t paying substantially more.


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