Right on cue, on the supposed threshold of talks with the IMF and Brussels, Hungarian Prime Minister Viktor Orban took a fresh swipe at the EU on May 25, demanding that an "unfair" threat to postpone EU cohesion funds be dropped. He also added a few choice words warning against closer union in the European bloc just for good measure.
As relations between Brussels and Budapest deteriorated in the first quarter over constitutional amendments and the country's rough treatment of foreign banks and other investors, the European Commission threatened to hold back close to €500m in development funding unless Hungary implemented budget measures to reign in its deficit to under the Maastricht Treaty limit of 3% - for the first time since it joined the EU in 2004.
Budapest's response remains almost entirely on the revenue side, and in May it rolled out a series new taxes on the same sectors it had hit before - the banks and telecoms primarily - much to the chagrin of investors once more. Meanwhile, with the approval of new legislation on the central bank due to go through parliament on June 4, Hungary should - theoretically at least - be due to finally open talks on a bailout.
Except many are highly skeptical that Orban and his government actually want a deal, given the tight conditions it would place on economic policy. The PM's penchant for raising the hostile rhetoric just as he is set to meet the folks he's meant to be asking to bail Hungary out is looking a little more than a coincidence now.
On May 25, he told public radio MR1-Kossuth: "The least that we deserve is equitable treatment and that the earlier unfair decision, which was about suspending funds due to Hungary, that this decision is scrapped, that this is annulled," reports Reuters. The government says its new taxes will keep its shortfall comfortably within the EU's limits both this year and next, and EU finance ministers will revisit their decision on the suspension of the funds on June 22.
Orban also used the subject of Hungary's financial transaction tax as a launch pad to express his opposition to the EU's proposed revenue raising schemes, which would include a similar tax - albeit on more complex investment banking operations rather than the simple trasnfer and bill-paying activities his levy will target.
"Hungary is against the EU having common revenues," Orban said. "The EU is an alliance of nations, therefore, a strong Europe can be borne only out of strong nations. Brussels should not start levying taxes of its own because that would result in such a bureaucratic Europe, we would drift into a United States of Europe, which voters could not decide about and I am not sure this is the path they want to follow."