Budapest, Hungary • The head of Hungary's largest broadcaster said Tuesday the company wants to remain in the country despite being seen as the main target of a new tax on advertising revenues.
RTL Klub CEO Dirk Gerkens said bowing to government pressure and leaving Hungary would be a "bad precedent" even though he said he cannot imagine a similar law being passed elsewhere in the 28-nation European Union.
The tax approved in June hits Hungarian media companies' annual advertising revenues in several steps and has been severely criticized by media experts. Only RTL Klub, the ratings leader, has ad revenues affected by the highest tax rate of 40 percent and it says it will pay $20.4 million in tax this year. That amount is equivalent to its 2013 pre-tax profits and about half of the total revenue the government expects from the new tax this year.