What benefits we will get by paying Taxes?

If you live anywhere you must pay taxes if you buy , sell or work.
In Hungary I suppose someday you might be able to claim taxes paid  from a job working here when you are old and retired but only if you have put into the HU tax base for at least 15 years.
15 years is the min, amount to collect any sort of Social Security when you are of age. Not sure but think in Hungary it is 62 years old but these figures are always changing. Used to be 55 for women and 60 for men but not any longer, think it's 62 for everyone but you still need to get in the 15 min. years of work.
VAT tax for all purchases is 27% which is included in the sticker price.
A bus pass is around $40. US per month for a adult, some jobs do give passes to employees but we have heard that BKK is thinking of having restrictions on that sort of travel. As it stand now some co. give employees a monthly pass for public transportation which they are free to use throughout the month even on weekends and when not using the pass to get to and from work. They are talking about having some sort of scanners which will limit the travel to stops to and from work only.
BKK is stating they are always losing money and always asking the gov. to help them out, with new restrictions  they are hoping to be in the red.
Students can apply for a discount travel pass, not sure how that works.
ATM I am looking into a senior discount pass but they require official translations on all papers that came from outside of Hungary also only able to apply since my husband is retired and had worked in Hu in his youth although he is short on the 15 years. Have to file out tons of forms with the HU SS and get translations then maybe we will be able to submit to BKK. Might just forgo it but it is only 30% of the current cost so will see how much they will charge for translations.
I guess you won't get any real benefits from paying taxes here unless you plan on working at least 15 years here. Taxes of course are used for the common good, fixing streets and paying for lights etc. Of course some districts are better kept up then others.
Some jobs will pay your health insurance coverage but not sure they will do a family plan.
It's the small things that make life more expensive here, a bit here and a bit there.
We pay no rent since we own but still it is getting more pricey here then just a few years ago.
I would say for 2 old people who cook at home and don't go out drinking we still run through at least a good $800. a month in total costs.
We have a car but that is not a major cost overall.

You will get free healthcare, education, firefighters, police, roads, pension among other things.

Your daily expenses entirely depend on what you spend. Please elaborate a bit on how your expenses are made up now, and by what.

VAT is 27% mostly, except for some things. Chicken, eggs and milk are 5%, Internet is 18%, and since january, dining is also 5%.

Health insurrance is paid by your employer from your wage automatically. If you arent employed, you must pay each month an amount, it is not optional. Children are free if (s)he is in a school,

I hope you know your net wage will be around 46% of your gross wage. VAT comes on top.

Marilyn Tassy wrote:

They are talking about having some sort of scanners which will limit the travel to stops to and from work only.
BKK is stating they are always losing money and always asking the gov. to help them out, with new restrictions  they are hoping to be in the red.

If you are thining of the new instruments being installed on buses, that is part of the new electronic ticketing system.

Students can apply for a discount travel pass, not sure how that works.

Simple, the student gets a "diákigazolvány" (student ID) from the school. It gets a new stamp for each new semester/year, signaling its validity. Then students simply buy a student pass. The student ID has to be on the person when using the pass.

I guess you won't get any real benefits from paying taxes here unless you plan on working at least 15 years here. Taxes of course are used for the common good, fixing streets and paying for lights etc. Of course some districts are better kept up then others.

Thats not how it works. Only council taxes stay in place, which only affect companies. The rest are collected by the state, which redistributes them. Infrastructure in settlements are not maintained from your tax money.

Apart from pension (which is a 10% tax) which has a minimum working time limit, the rest of the taxes (about 44%) do give you immediate services.

Linzee wrote:

what benefits will we get after paying taxes?

Taxes are a social issue. That is they are "spread around", as already stated (e.g. building pubic roads anyone can drive on).

Yet, as an Expat, some taxes you may not benefit from. Such as:

Marilyn Tassy wrote:

15 years is the min, amount to collect any sort of Social Security

So you pay into the social security (i.e. public retirement system) but if you do not do so for enough years, you get nothing. Again, this is a public social tax, not a "what do I get from it" tax. But I am sure your income, as an expat, is much, much higher than the average Hungarian, so do consider that. Simply invest your higher income wisely and you should probably come out better in the end.

Please note things I write could be wrong or misperceived. First of all welcome to Hungary (a good country to live). Quite a challenge to be a single mom with 4 children, I hope the job will be well paying. I am a bit unclear if this will be a normal employment or if you will have your own company (for the first scenario I would say it does not really matter what VAT levels are (what you pay net is what matters), in the second scenario however it could make a big difference though.
What you have to pay for health insurance is very low (please note things to do (and save) if you have your own company). Taxes in general are high (if you have a moderate salary (as indicated before in the thread). But then again cost of living is low (compared with many other EU countries).
Budapest is quite expensive for rent but in other regions both rent and real estate prices tend to be VERY competitive (again compared with other EU countries).

Lots of references are made to the 15 years employment which is true (however in many cases employment in Hungary can be aggregated with employments in other countries (in any case EU but also Russia (the latter I have heard recently). Could be good to double check (situation might be not as bad as the 15 years in Hungary indicated).

Also mentioned above taxes have to be paid in most countries and Hungary is not doing too bad (in my view low crime levels, good public transport, helpful police, good infra-structure, ...).

Still bottom line Hungary might be good, but I do not know what is expected and how old you and your children are. If the job does not pay very good countries with excellent social standard support might be better.

If there's one thing that gets people complaining it's taxes.   

I'm going to waffle on a bit from the macroeconomic perspective....

As ksallee pointed out, it's actually about redistribution to try and even out differences in income and direct the country to greater growth and wealth while balancing out on things like capital expenditure and operational costs like the military.  Quite a balancing act.

As for perceived value for money, it's debatable and often, it's most visibly a local issue or health, education or environment that tends to rile people.   Obviously I don't mind taxes being spent on road safety like speed bumps or better signage or schools or new water pipes in my village but I do object to some of the real nonsense where money is spent by central government.  Obviously that's political. On the other hand, governments are transitory and come and go as they get stale and out of ideas.   Eventually they trip up and get the boot.

My own experience over decades in multiple countries is that real growth is fueled by opportunity in deregulation/cutting red tape, improving competitiveness and specifically encouraging/incentivising all levels of the private sector but especially at the mid-level economy, like for example, smaller to mid-sized business (mom and pop stores, farmers, small manufacturing and services which the Germans call Mittelstand).  This is also often thought to be a bulwark against alternate political systems.

Governments are always laggards and often get pushed into action simply because they can no longer cope with the environment.  You can see this all the time where laws don't match with current practices in the field - the current fad on Bitcoin is one example.  Some governments are trying to get in on regulating it but without global intervention, they've no chance.

Better stop waffling now.

fluffy2560 wrote:

As ksallee pointed out, it's actually about redistribution to try and even out differences in income and direct the country to greater growth and wealth while balancing out on things like capital expenditure and operational costs like the military.  Quite a balancing act.

To be honest, as a theorist, I was being somewhat theoretical.

Too often taxes take from the 99% are give to the 1%. .

Of course, the 1% then spend there new income to build their yachts and palaces in Davos, so I guess the money reenters the system.... eventually. But not really the best way to inject capital into the economy. Or, more importantly, into the economy from which the money was originally taken.

fluffy2560 wrote:

but I do object to some of the real nonsense where money is spent by central government

on the PM's railroad.....

http://www.foxnews.com/world/2017/09/19 … nster.html

(yes, it was so stupid, even Fox News covered it)

fluffy2560 wrote:

My own experience over decades in multiple countries is that real growth is fueled by opportunity in deregulation/cutting red tape, improving competitiveness and specifically encouraging/incentivising all levels of the private sector but especially at the mid-level economy, like for example, smaller to mid-sized business (mom and pop stores, farmers, small manufacturing and services which the Germans call Mittelstand).  This is also often thought to be a bulwark against alternate political systems.

You and 99.9999% of all rational economists agree.

And yet... small businesses in Hungary still have a lot of outrageous bureaucratic hurdles to overcome if they hope to say viable. What a pity.

klsallee wrote:

....
To be honest, as a theorist, I was being somewhat theoretical.

Too often taxes take from the 99% are give to the 1%. .

This is one of the problems in taxation.   The stupidity of the system is that the richest have the means to create their own tax rate and therefore incur the greatest avoidance.   My own theory is that government is totally complicit in those arrangements as they know high taxes would nobble their economy and, really, quite rightly it should do as it's utterly uncompetitive and would drive everyone away.  One argument against left-wing tax and spend policies.

This is one of the arguments against the EU which has a minimum VAT level but no higher end.  That's ostensibly to maintain price stability (critical in the Eurozone). Further afield some places like say, the Bahamas have no income taxes etc., but they have very higher import duties and a low end VAT if I remember rightly as they have nothing much except tourism (and allegedly drug trafficking).   Even Saudi has VAT now but that's a bit of an outlier as it's a one product economy.

klsallee wrote:

....
Of course, the 1% then spend there new income to build their yachts and palaces in Davos, so I guess the money reenters the system.... eventually. But not really the best way to inject capital into the economy. Or, more importantly, into the economy from which the money was originally taken.

Yes, indeed, this is even the case in say, Colombia and the drugs market.   The cash enters the normal economy and then touches everything from construction to farming.  What better way to wash your drug cash than to pay tax on it?  Grow fruit and give it away or dump it and then declare the washed cash as income from fruit production and voila, it's now clean.  AML (Anti-Money Laundering) call it layering (i.e. layering it to hide it's origin).  This is famously shown in films like Goodfellas where money is washed in a casino or Breaking Bad in a car wash (no pun intended but I'll take it). 

klsallee wrote:

....
on the PM's railroad.....

http://www.foxnews.com/world/2017/09/19 … nster.html

(yes, it was so stupid, even Fox News covered it)

Yup, that's a really famous one hereabouts.  Further afield, there are plenty of other vanity projects, one of which I've been in a couple of times - Ceaușescu's "People's Palace" in Bucharest.  Almost broke the economy that one.  In Tirana, there's Enver Hoxha's tomb - a pyramid of delusion.  Seen a few others too - thebrand new airport in Spain that's a monument to local government folly.

klsallee wrote:

....
You and 99.9999% of all rational economists agree.

And yet... small businesses in Hungary still have a lot of outrageous bureaucratic hurdles to overcome if they hope to say viable. What a pity.

Totally.  But that's what bureaucrats do when they find it's a bit of an easy wheeze to screw a bit more off the very people who are that bulwark of support to the economy.   You can see how the government wants to stifle the economy by the repetitive (over years) thoughts to tax Internet usage here in Hungary.  Obviously that's a nutty idea but it's an easy win for them as they know where everything is and they can go directly to the providers for the data.

What baffles me is why most of these government types seem to have never heard of Laffer's curve or (Ronald) Reaganonmics?  I think really they do know but choose to push it to the limit on the grounds the population doesn't know or is fragmented (here, for sure).  The accepted wisdom is usually not to push tax rates past 50% because after that, people give up as it's simply not worth working (effectively) for nothing.   

One interesting "statistic" is that actually net taxes are about the same across the EU.  They are all around the mid-40%s plus and minus a bit.  It's been like that forever.

Allot of these rules and regulations do change from year to year or so.
My eldest sister worked hard  for 10 years in the UK at a major news station and paid allot of taxes but now after moving home in the US and being 70 years old, she gets zero from ever having worked in the UK.
So it was really more of a life experience for her rather then gaining anything else .
That's life, some put more into it then others and some gain without putting in much effort.
My husband was only 14 here in Hungary when he started trade school. The second year of school he did part-work and part school until his 4 years were done in which he did more work then school time in the classroom.On the job experience.
He was paid a little bit for his work time efforts and in the end was ready to take on a full time job.
Long hours of 10 to 12 hours per day 6 days per week for years, only got 9 years of work under his belt in Hungary his country of birth and now gets zero fro m his efforts.
Worked in the uS and right now as a retired person he could of been sitting pretty right now if those years had been spent working in the US instead of in Hungary.
So looking for any sort of fairness in this world is a waste of time.

Marilyn Tassy wrote:

Allot of these rules and regulations do change from year to year or so.
My eldest sister worked hard  for 10 years in the UK at a major news station and paid allot of taxes but now after moving home in the US and being 70 years old, she gets zero from ever having worked in the UK.
...

Really?

Please ask her if she had a National Insurance number.  I am sure she can get something out of the system.  If she paid into the NI system, then she should have credit there.  They will respond if she writes to them.  She can even  do it online. Doesn't matter if she's overseas.

Just as a bit of an aside, to show how much government cannot be trusted, my parents worked overseas in the Pacific region for years and after much arguing received their pension credits.  The UK government argued against them because they were working overseas for a colonial government. However, eventually they conceded the  British Empire government was the same as the UK government and they were forced to cough up their pensions.  Obviously not the same now.

fluffy2560 wrote:

The stupidity of the system is that the richest have the means to create their own tax rate and therefore incur the greatest avoidance.   My own theory is that government is totally complicit in those arrangements as they know high taxes would nobble their economy and, really, quite rightly it should do as it's utterly uncompetitive and would drive everyone away.  One argument against left-wing tax and spend policies.

Best said by:

“Sometimes I wonder whether the world is being run by smart people who are putting us on, or by imbeciles who really mean it.” - Mark Twain

klsallee wrote:

fluffy2560 wrote:

The stupidity of the system is that the richest have the means to create their own tax rate and therefore incur the greatest avoidance.   My own theory is that government is totally complicit in those arrangements as they know high taxes would nobble their economy and, really, quite rightly it should do as it's utterly uncompetitive and would drive everyone away.  One argument against left-wing tax and spend policies.

Best said by:

“Sometimes I wonder whether the world is being run by smart people who are putting us on, or by imbeciles who really mean it.” - Mark Twain

Indeed!

I think Mark Twain, Winston Churchill, Albert Einstein and possibly Grouchy Marx said everything there is to say about everything. Enriched us greatly with their wit and wisdom.   Candidates for The Donald's dream cabinet maybe.

I am not sure but perhaps with 4 children there could be some sort of tax break here but someone in the know wold have to answer that one.
I know HU citizens get some sort of tax break for children but not sure about non-citizens.
Heard that the internet services are or already have reduced taxes on the internet to 15% instead of the 27%.
Just started this month. That's not going to put anyone on easy street though, not a big amount of money either way.
The social system in HU is different then in the UK, from the little I know it seems the UK gives more in social benefits to people then they get over here in HU.
In the US they help just about anyone as long as they meet the income requirements.
Here in Hungary I had to sign at immigration that I would never apply for any aid in Hungary to get my resident permit. No biggie if I ever went down that far into the rabbit hole, I might as well jump off a bridge or get a bug out bag and live in the forest.
They do give work here to homeless and anyone here who excepts gov. aid must do the work program. Street sweepers or trash bin cleaning, working in the park on the grounds as a helper , something like that. They pay is very low heard it was something like 48,000 forints per month. Just enough to keep one in cheap booze. Or to rent share with a half doz. others.
I sort of wish they would pay them to clean up the sidewalks from all the pets around here...
We used to go to a local movie house and would often talk to the usher, he worked their most of his adult life. They closed the movie house and he lost his job. We ran into him once on the st. and he said he was collecting that 48,000 by doing work projects in the city. We once again ran into him while he was picking up trash in the city park. It was rather a sad thing to see.
People with small children also qualify for the 48,000 per child for up to 2 children. They have a cut off of only 2 kids but then again I could be wrong with my info. No small kids here so I never looked into that topic. Parents of small children don't need to work to collect that amount agina think for only a couple of years. The thing is in HU most people don't want to just collect that small amount, they may use the time to go to school while collecting to get a better job later.At least the smarter people do that. Hungary is not the place to move to and get much help with anything.

Marilyn Tassy wrote:

.....
The social system in HU is different then in the UK, from the little I know it seems the UK gives more in social benefits to people then they get over here in HU.
In the US they help just about anyone as long as they meet the income requirements.
....

The benefits in the UK are not that great even though it seems like more money.  The killer there is housing costs. These are extraordinarily high and there's very little help from the government.  This is why there is so much homelessness in the UK.  It's certainly no bed or roses. 

On the other hand, medical care is free which relieves a lot of the burden - it's free regardless of who you are.  Even if you are from the USA or Africa or anywhere and you get run over, you will still be treated for your injuries until you can leave hospital and return home.  They might try and get the money from you but it's not easy for them to do that.  You certainly won't die in the street because you couldn't pay.

One thing which is probably different to elsewhere - if you are in receipt of benefits - you are not require to actually work even if you are able. You have to sign up for work but it's relatively easy to feign mental illness or something like back pain which will mean you do not have to actually work.  If you have kids, then you are in an even better place - they may provide you with housing and living allowances.

We have  some real anomalies - ex-Servicemen in B&Bs and terrorists on benefits.  Quite weird.

I think they refer to it as "going mental" over in the UK?
Not sure, I watch enough "tele" to hear some of these funny/cute expressions from over there. I admit I sometimes must turn on the subtitles as the accents sometimes are hard to understand.
Oh, yes it called"being Sectioned"...
They have low income housing in the US called HUD but in some better states there is a 2 to 5 year waiting period to get in.
Not sure what to say about healthy young people faking bad backs etc. My mom had 4 kids and was our sole support, she never would ask for aid from the US gov. She never wanted us to feel like we weren't as good as kids with a father in the house.
She worked full time in a factory, night shift so my teen sister could sit us at night, cooked all day long before going to work so we always had a homemade meal, washed ironed helped with homework before heading to work, God only knows when she found time to sleep.
She grew up very poor because her dad was out of the house and her mom died but in the 1930's in the US there was zero help for children in need, she just got used to doing things for herself , she was a proud person who gave help but never took any.
Should put that on her headstone...
Reminded my sister about trying to look into any retirement benefits from her work time in the UK.
She is 70 and still working away, not sure where she gets the energy but she has always had more then average in doing things others wouldn't do. Learned karate, 3 different forms, entered beauty contests as a teenager, moved to the UK without knowing anyone, learned to deep sea dive, went skydiving, can ballroom dance and tap. Played violin and flute and took up drums,rides a motorbike , killed her own deer with bow and arrow and skinned it herself and does most of her own handy work around her home, even plumbing. I get tired just thinking of it all let alone doing a spinning drop kick on a person.Over achiever , not me.
Almost forgot she is also a gourmet cook and speaks fluent Spanish.
Of course she never had children so she had allot of free time.
I've been married to a Hungarian for over 40 years and still can't put together a decent string of words into a sentence in Hungarian.
They have food benefits for low income people in the US but now some states are thinking of making people get drugs tests to qualify for aid. What about the elderly who are on prescription drugs, things will be messy if they start nit-picking everyone like that.

Marilyn Tassy wrote:

I think they refer to it as "going mental" over in the UK?
Not sure, I watch enough "tele" to hear some of these funny/cute expressions from over there. I admit I sometimes must turn on the subtitles as the accents sometimes are hard to understand.
Oh, yes it called"being Sectioned"...

Yes, being Sectioned refers to being involuntarily detained in a mental institution for your own or other's safety.  It refers to one or more Sections of the Mental Health Act which empowers the authorities.  It can be pretty wide ranging as to why one might be sectioned.  People are detained for all sorts of reasons - including dementia.

Marilyn Tassy wrote:

....
Not sure what to say about healthy young people faking bad backs etc.

They don't have to be young, it can be anyone at all.  Some people receive social  security money if they are for example unable to work because they are unable to be returned to their own country (if for example, they would be executed or victimised there - for example politicians).  These people are not asylum seekers but involuntary residents. Couple of extreme examples  of people who are in an odd position: the terrorist mentioned in my other posting and Ms Yingluck, ex-PM of Thailand (who is currently rumoured to have been given a British passport).  In the latter case, it's hardly necessary for the ex-PM to claim social security - her brother is a billionaire.

Marilyn Tassy wrote:

Reminded my sister about trying to look into any retirement benefits from her work time in the UK.

If she paid in 10 years, she'll probably get a 1/3 of the full state pension as 30 years are needed (rules have varied recently).  Doesn't matter where she lives (she won't get inflation increases I suppose).  If she paid in just slightly less, she can pay a backdated contribution to bring her above 10 years and therefore improve her entitlement.

If she has an NI number she can ask for a statement online or fill in a form and send it in.  It could be worth a fair bit of money per year - a few thousand maybe. Here's a link to start: UK Pension Abroad

I'm no expert but she should try it.  It's her money after all.

Marilyn Tassy wrote:

They have food benefits for low income people in the US but now some states are thinking of making people get drugs tests to qualify for aid. What about the elderly who are on prescription drugs, things will be messy if they start nit-picking everyone like that.

Sounds extreme. I reckon that'd be unconstitutional or something.  What about states with medicinal cannabis?

fluffy2560 wrote:

I reckon that'd be unconstitutional or something.

Up to the Supreme Court to decide. And that deck is stacked.

Sis wrote me back saying she filed with the UK a year ago, nothing back from them yet. Going to look into why they are dragging their feet.

Marilyn Tassy wrote:

Sis wrote me back saying she filed with the UK a year ago, nothing back from them yet. Going to look into why they are dragging their feet.

She should be able to ask them what they are doing.  She can just quote her NI number and then that should be enough to track her down in the system.