Péter Magyar’s new government frames the levy as a test of “social justice” after years in which political loyalty and state contracts helped build vast private fortunes.
Hungary’s new government is preparing to launch a wealth tax aimed at the country’s richest citizens, a move that has unsettled business figures who flourished during Viktor Orbán’s long rule and now face a sharp reversal in political fortune.
Prime Minister Péter Magyar, whose Tisza party swept to power after 16 years of Orbán-led government, has presented the measure as a question of social justice. For his administration, the tax is not merely a revenue-raising tool but a symbol of a broader attempt to unwind the economic order built under Orbán, in which critics say political loyalty was often rewarded with access to state contracts, public advertising, infrastructure projects and regulatory privilege.
The proposed levy would target personal assets above 1 billion forints, roughly £2.4 million, and apply an annual rate of 1%. According to early outlines of the plan, taxable wealth could include property, company shares, foreign holdings, luxury goods and assets held through family structures. The government is also expected to move against tax exemptions and trust arrangements that have allowed wealthy individuals to shield parts of their fortunes.
The policy has already sent ripples through Hungary’s elite. Several prominent Orbán-era business figures are reportedly reviewing ownership structures, moving assets or preparing legal challenges. The case of advertising magnate Gyula Balásy has become especially symbolic: once a major beneficiary of state-linked contracts, he publicly surrendered companies and personal assets while citing the changing political climate and the expected impact of the new tax.
For Magyar, the wealth tax is part of a wider political and fiscal reset. His government has promised to cut VAT, lower income tax for poorer workers and restore Hungary’s access to European Union funding by strengthening rule-of-law protections and anti-corruption oversight. The administration argues that those who gained most from the previous system should now contribute more to repairing the state’s finances and rebuilding public trust.
The proposal also carries political risk. Opponents warn that a wealth tax could punish entrepreneurs, encourage capital flight and create uncertainty for investors at a moment when Hungary needs economic stability. Some business groups argue that the threshold may catch family-owned companies whose value is tied up in illiquid assets rather than cash. Orbán’s Fidesz party is likely to portray the policy as punitive, ideological and hostile to domestic capital.
Yet supporters say the Hungarian case is different from an ordinary tax debate. They argue that much of the wealth accumulated during the Orbán era was inseparable from public procurement, political patronage and a state-business ecosystem known by critics as the “System of National Cooperation.” In that context, the tax is being framed not as an attack on success, but as a corrective to a distorted economy.
The coming weeks will test whether Magyar can turn a campaign promise into enforceable policy. Designing the levy will require clear asset valuation rules, strong anti-avoidance mechanisms and enough administrative capacity to track wealth held across borders or through complex corporate vehicles. The government will also have to reassure legitimate businesses that the measure is targeted at extreme wealth rather than broad private enterprise.
