Hungary's government may raise the tax payable by drug companies on state-subsidized drug sales to 20%, not 18% as previously planned, a pharmaceuticals sector source told Reuters on Wednesday. The tax is currently 12%.

"The latest we've heard it's going to be 20%," the source, who spoke on condition of anonymity, said.

The tax increase is part of the government's efforts to slash the more-than-300-billion-forint ($1.66 billion) state drug fund by 120 billion forints by 2013 in a drive to keep the budget deficit below 3% of economic output.