Hungarian workers block roads to protest new tax law

Protesters in Hungary’s capital have blocked main traffic arteries for the second day in a row in opposition to a tax overhaul pushed through this week by lawmakers from the country’s right-wing governing party

Protesters in Hungary's capital blocked main traffic arteries for the second day in a row Wednesday in opposition to a tax overhaul pushed through this week by the country's right-wing governing party.

Several thousand demonstrators, many of them independent entrepreneurs affected by the new changes, gathered in a main square beside Hungary's parliament to protest a law passed Tuesday that many fear will result in significant tax hikes. Following the protest, most marched through central Budapest during peak rush-hour traffic.

Hungary's ruling Fidesz party, led by nationalist Prime Minister Viktor Orban, used its parliamentary supermajority to pass the new law, which targets a popular tax scheme allowing small businesses and individual contractors like hairdressers to pay a low flat tax rate.

Protester Tibor Tarcsay, 33, said his livelihood as a freelance translator is jeopardized by the changes, and he's not sure how he'll make ends meet once it takes effect in September.

“I might move abroad,” he said. "In two months, crowds of people are going to be standing in line at charity organizations to get a can of lentils.”

Estimates suggest up to half a million workers in Hungary use the tax scheme known as KATA.

But Hungary's government says many companies have abused the system by having workers on contracts rather than employing them, thus depriving the country's budget of between 250 and 300 billion Hungarian forints ($614 million to $736 million) in tax revenues annually.

The protest, which followed the occupation of two bridges Tuesday over the Danube River, was the first sign of popular discontent in Hungary since Orban and his Fidesz party were reelected in a landslide in April.

Hungary has been facing record weakness of its currency against the euro and the dollar, as well as the highest inflation in nearly 25 years. The government is keen to fill gaps in its budget left by major handouts to voters before the election.

Critics of the new tax law say it was passed without consulting affected workers, and pushed through Hungary's parliament in only a single day.

Balazs Zoltan Biro, 37, works for a food delivery company in Budapest as a bicycle courier. Blocking traffic with other demonstrators at one of Budapest’s busiest intersections, he said he believed civil disobedience was the last resort for opponents of Hungary's government.

“That they made a decision with the stroke of a pen, without negotiating with those whom it really affects, is not democratic at all,” he said.

Another demonstrator, book editor Marta Nagy, said she was likely to lose all of her clients.

“The worst would be if I have to give up my rented apartment and move home,” she said. “What will I live on?”