Hungary's PM Pledges Zero Income Tax to Women with Four Kids

-edited

The birth rate in many European countries has plunged. Hungary's Victor Orban wants women to have more kids.

In a move to counter falling population without allowing migration, Victor Orban promises Hungarian mothers Have Four Children and Pay No Income Tax for life.

“There are fewer and fewer children born in Europe,” Mr Orban said during his annual State of the Nation address. “For the west, the answer is immigration. But we do not need numbers. We need Hungarian children.”

Orban did not say how he would pay for the scheme. Of course, no one ever says how they will pay for any scheme.

Poland and Serbia have similar proposals on the books.

Have-a-Kid

  • Poland gives 500 zlotys a month, about a third of the minimum wage, to mothers for their second and subsequent children. That about $130 per month.
  • Serbia gives 12,000 dinars to families with three children and 18,000 dinars for the fourth. That's about $114 and $172 per month respectively.

Serbia Population

Starting sometime between 1995 and 2000, World Odometers shows Serbia started losing population and it has continued ever since.

Hungary Population

Poland Population



The EU allows freedom of movement. Those in Eastern European countries are voting with their feet.

Mike "Mish" Shedlock

Comments (39)
No. 1-15
Carl_R
Carl_R

Economics was given the name "the dismal science" due to the theory of Malthus that in times of abundance human population would increase until the population was once again limited by the means of subsistence. It seems we have found a way out of that trap.

Escierto
Escierto

It's obvious the populations of these countries see no future there which is why these cockamamie schemes have no chance of working. Why not enact economic reforms that free the people like less regulation and low taxes for all?

shamrock
shamrock

Why do they need more people?

Schaap60
Schaap60

It looks like the population in each of the countries has fallen since the year before the highlighted periods since the "yearly change" is based on the previous period. For example, Hungary's population has been declining since 1980. Of course, it's possible it went up from 1980 to 1981, only to fall by a larger percentage over the rest of the five year period. In any event, those are very long-term declines.

Mish
Mish

Editor

Latkes: "It will cost very little, because there will be very few takers. You can't meaningfully increase natality by bribing women."

Mish: The FT reports "the initiative costs more than 1 percent of Poland’s GDP" That's quite a bit

superDuper
superDuper

In a future dominated by robots and artificial intelligence a small, highly skilled population will be a blessing.

27CAV8R
27CAV8R

If you'd like to know what the world is going to look like in 50 years or so, just look at who is having babies...and who is not. Demographics is a fairly easy discipline to understand.

Tengen
Tengen

I get the desire to boost birth rates, but this does nothing to address the underlying problem, the financial ponzi that hangs over all of us. Kids today are born into an insane debt burden they can't possibly deal with. Furthermore they'll have to try to live through the great reset and all the hardship it entails. They're in for a much tougher slog than we had, all this because we wouldn't let this ridiculous system collapse a decade ago when it wanted to.

I suppose Orban is just trying to think outside the box, but he's addressing a symptom rather than the problem.

ML1
ML1

Great idea by Orban.

Those families having 3 kids will now consider making the 4th to have the mother be tax free from then on.

I would improve the idea by giving moms back the taxes they paid in the last 18 months for the 3rd baby and then tax freedom from the 4th.

I hope Poland, Serbia, Czech, Slovakia, Slovenia, Croatia also copy this policy.

When many countries have done it maybe other EU countries will also copy this.

The beauty is that it is freedom from taxes so benefits those who work.

The "let's give more welfare" style that Western Europe and Northern Europe currently use causes Somali families with 8-10 kids and iraqis, afghans etc. making huge numbers of kids while in large part of those immigrants families the whole family lives on welfare long term.

Six000mileyear
Six000mileyear

1.) This ploy is to generate future economic need and taxpayers tp repay debts. 2.) This is an implicit admission the bulk of European immigrants have no wealth grow the economy, let alone raise a family.

Webej
Webej

This will cost next to nothing. How many women with four children have a large income tax liability, after existing deductions for the children? They're lucky to do some part-time work. Any scheme that creates an incentive for children is a good investment in the future of pension liabilities and the credit-worthiness of the state. It is also has a much higher return on investment than unskilled migrants who will break the social solidarity and cooperation, bankrupt the social safety net, and eventually displace the population.

Sechel
Sechel

i'm going to speculate that the poorest and least educated will most respond. It could be that such a policy increases gov't outlays more than intended. The better educated and more affluent women probably will not respond to such incentives. There's probably more at play in declining birth rates than simply taxes.

KidHorn
KidHorn

The only part of the world with population growth is sub Saharan Africa. And they have too much growth. The problem is government ponzi schemes require an ever growing population and nobody wants blacks emigrating to their country.

KidHorn
KidHorn

In the US we have similar incentives. The more children, the bigger the welfare check. Problem is it only encourages those on welfare to have kids. And those kids have a preponderance to end up on welfare too.

tz1
tz1

We do the same thing, but only if the kid is born out of wedlock, likely in an inner city to a welfare mother.