Hochtief goes to court over trebled Budapest Airport land bill

The Hochtief-led consortium operating Budapest Airport has been slapped with a near-€8bn land bill for this year – a 330% increase over last year’s bill.

The consortium operating Budapest Airport – led by German developer Hochtief – has appealed to the Constitutional Court of Hungary after being served with a land tax bill three times higher than 2011’s equivalent.

In a statement, the Budapest Airport operator points out that it is due to pay HUF2.25 billion (€7.8 million; $9.9 billion) this year in land taxes alone – a 330 percent increase from last year’s bill. 

“The amount of land tax levied […] in 2012 violates the constitutional principle of the proportionate sharing of public burdens.  According to the airport operator’s legal position, the municipalities in question determined the amount of land tax in an undifferentiated manner and at a disproportionately high level,” the consortium argued in a statement.

The airport operator also highlights that it is the largest tax payer in the southern Pest region and that it has invested over €265 million in the airport since taking ownership of it in 2006. It also warned that it is still reeling from the bankruptcy of Hungarian national airliner Malev earlier this year, which accounted for some 37 percent of Budapest Airport’s annual turnover.

“In order to manage the post-Malev crisis, Budapest Airport submitted a package of more than ten proposed measures to the [Hungarian aviation and tourism] ministry, which included significantly reducing the land tax burden of the airport. The answer to the proposal was rejection on the one hand and a further increase in the land tax on the other, so the airport operator has been forced to take legal steps as well,” explained Jost Lammers, Budapest Airport’s chief executive.

In a swipe at the municipalities increasing the land tax, the airport operator points out the “peculiar concurrence that one of the main beneficiaries of the land tax modification is Budapest District XVII, which, according to a survey analysing the financial management of municipalities, amassed record levels of debt running into billions of forints last year [finishing] as the third most rapidly indebted local government in Hungary”.