Viktor Orban: Football & ‘Tax Secrets’ in Hungary


Hungarian football no longer enjoys the reputation
it once did. Even now, its strongest
association remains the Mighty Magyar side
that humiliated England in 1953 and humbled
the Three Lions into an ideological panic.
Hungarian football obviously hasn’t all
been doom and gloom since that remarkable
performance 66 years ago, the very next year
they reached a World Cup final, but since
the revolution of 1956, footballing high points
have been few and far between.
1986 was the last time Hungary qualified for
a World Cup. At club level, since the birth
of
the Champions League in its current form,
Hungarian sides have taken part in the group
stage just twice.
And yet, football’s popularity within Hungary
has never waned. The focus of that interest
may have changed – Hungary’s top flight
has an average attendance of just 2,733, less
than League Two in England – but the game
still remains as popular as ever.
Nevertheless, the memory of that wonderful
Mighty Magyar side continues to provide an
inconvenient context, serving to illustrated
just how sharp the country’s decline in
the
years since has been.
That nostalgia, that willingness to do better
and be good again, has great resonance in
the
Hungarian conscience and Viktor Orban, the
country’s Prime Minister of the last nine
years, knows that better than anyone.
Nostalgia is a key commodity within the nationalist
playbook and Orban, just like Jair
Bolsanaro and Donald Trump, can vouch for
its effectiveness. Moreover, nostalgia is
Orban’s speciality, as revealed during the‘Migration
Crisis’ of 2015, when Budapest found
itself at the centre of a continent-wide controversy.
Orban tapped into the nation’s emotion with
provocative rhetoric, referencing Hungary’s
long held Christian faith and evoking stories
of the past when Hungary was, in his words,
“the first defensive line” against the
Ottoman Empire. Or, quite simply, the “Muslim
invaders.”
Such nostalgia has had a political effect
in Hungary, but it’s also had a profound
influence
in football, too.
Orban himself was a decent footballer who
floated around Hungary’s fourth and the
fifth
tier, but since retiring from the game in
2005, Orban has combined his love for football
and politics. Indeed, 14 years on and nine
years since returning to Prime Ministerial
office,
the Hungarian football landscape right now
is saturated by Orbanism.
Four years into Orban’s second Premiership,
the Honved chairman George Hemingway
declared that, “Hungarian football would
be dead without him.” Now, following
Hemingway’s sale of Honved this month, 11
out of the 12 clubs in Hungary’s top division
are owned by a direct governmental ally. The
most interesting of those is Puskas
Akademia, a first division club who are not
actually linked to Ferenc Puskas, and not
even
based in the city of his birth, but who still
bare his name.
In fact, the club is actually based in Felcsut,
the city of Orban’s birth and on land that
Orban himself sold to fund the academy. The
club didn’t really get any traction during
its
first few years, but when Fidesz, Orban’s
party, looked set to win re-election in 2009,
Orban formed a partnership with Videoton (now
MOL Vidi) which saw a number of academy
graduates move to the then second-tier club.
Now in 2019, Puskas Akademia boast one of
Europe’s most beautiful stadiums and have
already produced footballers who have moved
to Barcelona, Werder Bremen and Freiburg.
But it is more than just a football club.
It is now Orban’s symbol of power and the
headquarters of a contentious dream.
Since 2010; Puskas Akademia, Debrecen, Ferencvaros,
MTK Budapest, Haladas, MOL Vidi,
Kisvarda, Mezokovesd, and Disogyor have all
had decadent new stadiums built, while the
new 68,000-seater national stadium, the Puskas
Ferenc Stadion, will open later this year
in Budapest.
During this time, a host of new academies
have cropped up from Szombathely to
Csíkszereda, a Hungarian minority town in
Romania. Indeed, over €70m has been spent
on
football academies in Hungarian minority towns
in Romania, Slovakia, Slovenia, Ukraine,
Croatia and Serbia, while the Romanian and
Slovakian top divisions both house a Hungarian
minority side. In total, approximately €1
billion of public money has been spent on
Hungarian football since 2010.
Orban is a smart man, he knows how patriotic
and proud his people are, and he knows
what moves them emotionally. Though the “football
first” policy is far from his most
popular strategy, Hungarians do have a burning
desire to see the Hungarian football team
become more prominent on the world stage again.
Furthermore, investing in the infrastructure
within Hungarian minority towns in
neighbouring countries has been government
policy since Fidesz’s change to the Hungarian
Citizenship Law in 2011, which now allows
descendants of those who were Hungarian
citizens before 1920 or during 1941 to 1945
to acquire Hungarian citizenship and vote
in
elections. Over 750,000 people had applied
by last count in 2015, which means 750,000
more people almost exclusively voting for
Fidesz.
In the background, Orban, through football,
has built a base and a network at home and
across central and Eastern Europe – his
very own cast of oligarchs. Orban keeps them
loyal
by providing his favoured few with enormously
inflated state construction project
contracts which are funded by the EU, with
the profits then shared with said oligarch
and
the ruling party.
The contracts to construct Hungarian football
stadiums and academies are an example of
this, and for investors they come with the
added incentive of a tax return programme

named TAO – which was set up in 2011. Between
2011 and 2014, when the figures were
less opaque, the owners of the Hungarian football
clubs received over €250m from these
contributions.
“The system of corporate tax-breaks for
those promoting sport ensures the possibility
of
attracting substantially greater funds into
spectator sports, football included,” is
the
wording on the Hungarian FA’s website.
Since TAO passed through parliament in 2011,
the legislation has faced fierce criticism,
not least because, since 2016, the information
related to contributions made through the
TAO program is classified as a ‘tax secrets’
and is therefore not accessible to the public.
In 2015, a non-governmental organisation called,
‘Transparency International Hungary’
issued a report which warned against serious
corruption risks posed by the TAO
contribution system. The suspicion raised
by Transparency International was that the
“contributions may be made to sports clubs
tied to politicians in exchange for the donor
being awarded lucrative public procurements.”
12% of the €250m spent within the first
three years of the programme went to Puskas
Akademia, Orban’s pet project, who are owned
by his ally Lorinc Meszaros.
Back in 2007, Meszaros’ sole company, Meszaros
& Meszaros, was teetering on the edge of
bankruptcy, yet as a Felcsut native he was
given the keys to Puskas Akademia by Orban,
and ever since the pair have been commercially
inseparable.
Fast forward 12 years, and Meszaros is now
Hungary’s richest man owning over 100
businesses along with over 200 television
and media outlets, including Hungary’s sports
daily Nemzeti Sport and all the regional newspapers
in 12 of Hungary’s 19 counties, giving
Orban a megaphone to broadcast his rhetoric.
Over 80% of Meszaros’ wealth has come
from ‘winning’ EU funded state projects.
In the eyes of Hungarians, Meszaros is Orban’s
yes-man, but it’s not limited to Meszaros,
he’s just the biggest name. It’s everywhere
in Hungarian football. To any straight-thinking
person, investing so heavily in the sport
must look absurd, and that’s because it
is.
Hungary isn’t a wealthy country. Right now
over 25% of Hungarians are threatened by
poverty while only ten countries in Europe
have a lower life expectancy, with Hungary
spending nearly 3% less in GDP terms on healthcare
compared to the rest of the European
Union.
Sine joining the EU in 2006, 600,000 Hungarians
have left the country. Many of these are
skilled professionals and Doctors, who in
Hungary are paid the least of all the 34 countries
in the Organisation for Economic Co-operation
and Development. United Nations
projections estimate that there will be 15%
fewer people in Hungary by 2050.
It’s obvious that so much public money shouldn’t
be spent on Hungarian football yet
investing in healthcare doesn’t consolidate
power. And, unfortunately, it doesn’t galvanise
nationalist fervour either. Viktor Orban knows
what does.

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