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Hungary exempts mothers of at least two children from taxes for life

Viktor Orbán's government is introducing a series of new tax measures for families this year, especially affecting women.

A child plays with a Lego exhibit in Hungary.

A child plays with a Lego exhibit in Hungary.AFP

Juan Peña
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The Hungarian government, led by the conservative Viktor Orbán, is once again working on boosting the birth rate in the European country. It is using a series of new measures that were confirmed this weekend and that will exempt mothers with one child from taxes until the age of 30. Women with at least two children will be exempted from life.

These measures affect any taxes that may be imposed on women. Any woman with at least two children will no longer pay income taxes for the rest of her life. Starting in October 2025, these exemptions will be applied gradually. The measure will affect an estimated 250,000 mothers with three children and between 600,000 and 700,000 mothers with two children.

The government claims that it is willing to assume this cost, which is in addition to many other tax breaks that exist for some social groups. It already had a number of subsidies for families depending on the number of children. With these exemptions, the government is expected to collect much less through taxes.

Hungary has currently had a fertility rate of around 1.5 children per woman. It is only slightly above the European average. Orbán's administration has been working to boost this rate, as they strongly oppose using immigration as a solution to reverse the country’s aging population.

As reported by the Wall Street Journal, Hungary claims that in recent years its spending on policies for families has exceeded 5% of GDP. The U.S. spends about 1% of GDP on family support through child tax credits and programs aimed at low-income Americans.

However, the math still doesn't add up for the Hungarian government. Some reports indicate that fiscal measures do not sufficiently stimulate the birth rate and that it has more to do with cultural and social changes.

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