(Adnkronos) – The Hungarian parliament has approved a law that risks sending Budapest mayor Gergely Karacsony, from the opposition, to prison, as it could force the cash-strapped municipality to take out loans under unclear conditions. A few weeks ago, Karacsony, from the Green Party, had warned that the capital, with its 1.6 million inhabitants, risked insolvency, especially due to taxes decided by the government. Karacsony regularly accuses Prime Minister Viktor Orban of draining Budapest and other important municipalities to prevent them from offering an alternative model of governance. Orban’s Fidesz party, for its part, claims that the capital’s financial difficulties are linked to its mayor’s “irresponsible spending.”
The law on “granting a loan to prevent the bankruptcy of the municipality of Budapest” was approved with 136 votes in favor and 34 against during an extraordinary parliamentary session. Under the new law, the municipal administration can request a loan from the Hungarian Development Bank after the deadline for salary payments. The administrative services of the municipality of Budapest, led by a close associate of Orban, can also compel him to take out a loan, the terms of which are the government’s responsibility, including its duration, interest rate, and collateral. The law also requires the mayor to produce financial documents and implement reforms within six months, under penalty of a two-year prison sentence.
The municipality of Budapest is required to pay a so-called solidarity contribution to the state, which has increased almost ninefold since Karacsony’s election in 2019. The municipality has filed several lawsuits, arguing that this tax is unconstitutional, but the government has defended its existence by claiming that it must redistribute funds from wealthier cities to less wealthy ones. Karacsony also announced that the police had recommended legal action against him for evading the Pride ban in the Hungarian capital. If the court follows this recommendation, he faces up to a year in prison.
