Flat tax race continues to leave out Hungary

which makes no fucking sense, pardon my french, because if there’s one economic problem that any Hungarian can instantly identify, it’s that they’re overtaxed. In fact, they’re milked like cattle, paying taxes that are illegal to implement in the EU, and charging people left and right with blatant abuses of taxation power (for example, you pay both a pollution and a road-maintenance tax if you have a car… or, if you don’t).

So here we have Romania in at 16%, the Czechs are about to go in at 15%, Macedonia and Bulgarian jumping down to 10% (though, as this article points out, tax rates alone don’t make you a “business paradise,” and everybody in Hungary who can now drives to Croatia or Slovakia to buy big-ticket items.

This sucks. My father-in-law’s restaurant would be a seriously great gig (they’re lunch-only and have an *average* of 95-100 diners a day with a semi-captive audience and a location that is good, but not fancy enough to make lease rates a danger) — good enough that I would seriously consider picking it up from him when he retires. And anybody who’s been in the restaurant biz can tell you that I haven’t given you enough info, but that on the surface, that sounds like a successful mom’n’pop joint. But he will likely retire this year, because with taxes on everything (including VAT, which Americans don’t pay), he literally loses so much to taxes that he can barely keep the business afloat. It’s the equivalent of having a 20% p.s.f. increase every year on his lease.

Meaning the prognosis for Hungary at this rate is bad.

Folks, we’re also behind the curve on this. The Europeans are learning that if they want to sustain welfare states, they have to bring in some seriously kick-ass growth. Those of us in the U.S. who want to lean left and have a larger social safety net need to look at Europe and the lessons they’re learning… or else learn them the painful way as our transatlantic neighbors have.

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