Hungary implements firewood price controls and doubles social fuel subsidies

The Hungarian government has implemented new measures to control the price of firewood and its derivatives. Under a recent government decree, 100 percent state-owned forests and budgetary bodies are required to sell firewood—including logs, brushwood, and compressed wood products like pellets or briquettes—to the public at the net prices established on January 1.

Additionally, the government has doubled the budget for the Social Firewood Program, increasing the funding framework from 5 billion to 10 billion forints. The program distinguishes between settlements based on unemployment rates: municipalities with significant unemployment can receive subsidies of up to 23,000 HUF plus VAT per forest cubic meter of high-caloric hardwood, while other settlements receive 21,000 HUF plus VAT.

Because the sale price for the social program cannot exceed the subsidy amount, residents in participating settlements will effectively receive firewood for free. This measure is supported by a reduction in VAT for these products, which is set to drop from 27 percent to 5 percent starting September 15.