BUDAPEST (Reuters) – Hungarian Prime Minister Viktor Orban froze plans on Friday to impose a tax on Internet traffic, climbing down in the face of massive street protests and warnings from the European Union that the levy was a mistake.
Opponents of the tax, who said it would have hurt consumers already struggling with a faltering economy, described the U-turn as a major victory.
But Orban’s announcement was unlikely to end discontent among liberal Hungarians who accuse him of being an autocrat and are frustrated there is no prospect of removing him until elections in 2018. Recent anti-tax rallies have been a catalyst for broader anti-government protests.
“This tax in its current form cannot be introduced,” Orban told public radio. “If the people not only dislike something but also consider it unreasonable then it should not be done.”
The climb-down was unusual for the usually combative Orban, but he may have decided that he already had enough contentious issues on his plate.
The U.S. government has barred six people with ties to the government in Hungary, a NATO ally, from entering the United States. It alleges they are involved in corruption. Orban is also tangling with big European banks over a scheme to help borrowers that will cost the banks huge sums.
Meanwhile, there is concern in Western capitals that Orban is drifting into the orbit of Russian President Vladimir Putin.
In his four years in power, Orban’s government has ordered an audit into civil society groups, has tightened state oversight over the media and slapped costly levies on foreign companies.
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