After huge protests, Hungary suspends plans to tax Internet use; to revisit issue next year

BUDAPEST, Hungary – Following large-scale protests, Hungary’s prime minister said Friday that the government would suspend a planned tax on Internet use and reconsider the matter next year.

A scheme to make Internet service providers pay 150 forints ($0.62) per gigabyte of Internet traffic, later proposed to be capped at different monthly rates for individual and business users, prompted tens of thousands of people to make their discontent known during two protests in the capital Budapest over the past week.

Many protesters also considered the tax as another effort by Prime Minister Viktor Orban to centralize power, muffle the media and greatly increase the role and influence of the state in many walks of life, from business and religion to education and sports.

While Orban’s Fidesz party retained its two-thirds majority in Parliament in April’s elections and the prime minister is at the start of his third, four-year term, anti-government sentiment appears to be on the rise.

Arguments with the European Union and the United States, which recently banned six unnamed public officials from entering the U.S. because of corruption, have eroded some of Orban’s support.

Orban said the tax would not be introduced because “people have questioned the rationality” of the measure. However, he said the government will hold a national consultation from mid-January about regulating and taxing the Internet.

“We are not communists,” Orban said on state radio. “We are not governing against the people but together with the people.”

Initially, the government tried to paint the protests as a left-wing initiative. However, it soon became clear the planned tax mobilized mostly youthful crowds from across the political spectrum, including many who said they were marching for the first time.

The government said it was necessary to expand the telecommunications tax to include the Internet because people were increasingly using it to make phone calls. Hungary needs more money to meet its deficit targets.