The Administrative Division of the Metropolitan Court of Budapest has granted immediate legal protection to the Municipality of Budapest in its case against the Hungarian State Treasury, the court’s press office confirmed on Tuesday.

According to the court’s decision, the Treasury is temporarily prohibited from executing any withdrawal orders against the Municipality for the months of May, June, July, and August 2025, relating to the contested solidarity contribution. This protection remains in place until the conclusion of the ongoing legal proceedings.

Additionally, the court ordered the Treasury to pay 10,171,449,024 forints (approximately 26 million euros), along with interest calculated from 29 May until the date of payment, to the Municipality.

In its justification, the court emphasized the municipality’s unique position, being responsible for the public services of millions of residents. It found that if the Treasury were to carry out the withdrawal, it would severely compromise the capital’s liquidity and render it unable to fulfil its public duties.

Weighing the competing public interests, the court ruled that the harm to the Municipality—should legal protection be denied—would be greater than any potential negative impact on the Treasury. It applied the principle of proportionality, citing the specific legal threshold for immediate protection: when an irreparable situation directly caused by the contested action poses a severe burden on the claimant.

In this case, the court determined that the disputed contribution directly and irreversibly damages the Municipality’s financial stability—a claim Budapest City Hall substantiated with detailed calculations.

The ruling marks a significant development in the ongoing fiscal and legal tensions between Hungary’s central government and its capital, particularly around the controversial solidarity contribution, a tax imposed by the government on wealthier municipalities to redistribute resources.

Related articles: