Hungarians celebrate their national holiday today but, amid the sea of national flags, scattered islands of red and white stripes spell trouble.

The Arpad flag is a millennia-old symbol of the Magyar tribes, and its increasing presence on the streets is unsettling many and fuelling political tensions.

Tens of thousands of demonstrators are expected at an opposition rally by the Elizabeth Bridge, Budapest, the scene of violent clashes in October. The presence of the Arpad flag, say some, is a sign that Hungary’s national traumas, frozen under 40 years of Communism, are finally surfacing.

The Arpad flag is part of the country’s official coat of arms. It also provided the inspiration for the Hungarian Nazi Arrow Cross party, which briefly took power in 1944, adding a green or black cross.

Ferenc Gyurcsány, the Prime Minister, told The Times: “For the majority of this country the Arpad flag is a symbol of the Hungarian National Socialists. Under this flag hundreds of thousands of Hungarian Jews were marched to Auschwitz.”

The Arpad flag’s defenders say that it is a slice of history that should not be confused with the fascist flag. “They have different designs. Every prime minister, including Ferenc Gyurcsány, also swears allegiance to the Arpad flag,” said Sebestyen Gorka, director of the Institute for Transitional Democracy.

Janos Rainer, of the Institute for the History of the 1956 Revolution, said it was no accident that of all the country’s ancient symbols, it was the Arpad flag that had made a return.

Across the region the minutiae of heraldry still trigger turbulent emotions. In 1991, as Yugoslavia collapsed, President Tudjman of Croatia chose a version of the Sahovnica, the ancient Croatian red and white chequerboard flag, appropriated by the fascist Ustasha regime in the Second World War, and used under Communism. Serbs pointed to the new flag as evidence that the Ustasha era was returning. Croatians argued that the Sahovnica was part of the country’s heritage.

Hungary’s fevered political atmosphere intensified after Mr Gyurcsány said this month that antiSemitism was reaching unprecedented levels, and accused the Fidesz opposition of sharing “a community of interest” with the far Right, a claim furiously rejected by Fidesz MPs. Fidesz officials prefer to stay silent on the tricky question of the Arpad flag.

There is still widespread anger over Mr Gyurcsány’s private admission in September that the Government had lied “morning, noon and night” about the problems facing the country. When they were leaked, the comments sparked riots whose legacy lingers.

David Irving, the right-wing historian, is due to speak at a rally today organised by the far-right MIEP party. Peter Feldmajer, the leader of Mazsihisz, the main Jewish organisation, recently provoked consternation – not least among Jews – when he suggested that they should consider leaving the country. He then retracted his statement, saying that it was a joke for the festival of Purim.

The answer to the Arpad flag controversy, some argue, could be to cut a hole in it, as happened with the Communist-era flag, when its Marxist insignia were excised, and so defuse its symbolic power.

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