In Hungary, companies will be able to pay their taxes in

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Hungary will allow companies to pay their taxes in euros or dollars, the government announced on Saturday, a move that analysts say could boost the country’s reserves at a time when the need for hard currency has soared.

Like other central European countries such as Poland, the Czech Republic or Romania, Hungary is nowhere near adopting the euro, with Prime Minister Viktor Orban’s government ruling it out in the near future, arguing that it would mean a loss of sovereignty economic policy.

Hungary’s move is similar to a plan announced last month by the Czech government to allow companies to pay taxes in euros from 2024, allowing the state to increase its euro borrowing.

“If it is technically easier for companies to pay taxes in euros or dollars, then it is also easier for the Hungarian state, because import needs have skyrocketed,” Orban’s chief of staff said on Saturday at a briefing.

Gergely Gulyas said that Hungary’s raw material imports, paid in foreign currency, used to be 3.0-3.5% of total imports, but have now reached 20-21%.