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New Taxes to Improve the Balance of Public Finances

New Taxes to Improve the Balance of Public Finances

Hungary
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The Hungarian Government introduced two special taxes from 1 May 2020 in order to tackle the financial effects of the coronavirus disease: the special tax on credit institutions and the tax on commercial chains. According to the official communication of the Ministry of Finance „the goal is that the burden of these taxes – that contribute to the improvement of the balance of public finances – are borne not by the consumers but by the actors that are capable of such.”

The tax on credit institutions is only payable in the tax year of 2020 in three instalments. The tax has to be paid after the corrected balance sheet total that exceeds HUF 50 billion, at a rate of 0.19%. The payable tax can be reduced by supporting popular team sports. According to the official communication of the Ministry of Finance, this special tax will be deductible from the already existing tax that has to be paid by financial institutions. Further details of this tax have not yet been elaborated in the laws.

The tax on commercial chains must also be paid from 1 May 2020 until the end of the state of emergency special legal order. The tax base is the net turnover of the taxpayer and the tax rate is specified progressively, provided that the net turnover reaches HUF 500 million on a yearly basis. This special contribution targets not only Hungarian but also international commercial chains (available in Hungary), such as Amazon, Wish or Aliexpress. According to the official statements this special tax will be a permanent tax also after the end of the state of emergency.

By Eszter Kamocsay-Berta, Managing partner, KCG Partners Law Firm

Hungary Knowledge Partner

Nagy és Trócsányi was founded in 1991, turned into limited professional partnership (in Hungarian: ügyvédi iroda) in 1992, with the aim of offering sophisticated legal services. The firm continues to seek excellence in a comprehensive and modern practice, which spans international commercial and business law. 

The firm’s lawyers provide clients with advice and representation in an active, thoughtful and ethical manner, with a real understanding of clients‘ business needs and the markets in which they operate.

The firm is one of the largest home-grown independent law firms in Hungary. Currently Nagy és Trócsányi has 26 lawyers out of which there are 8 active partners. All partners are equity partners.

Nagy és Trócsányi is a legal entity and registered with the Budapest Bar Association. All lawyers of the Budapest office are either members of, or registered as clerks with, the Budapest Bar Association. Several of the firm’s lawyers are admitted attorneys or registered as legal consultants in New York.

The firm advises a broad range of clients, including numerous multinational corporations. 

Our activity focuses on the following practice areas: M&A, company law, litigation and dispute resolution, real estate law, banking and finance, project financing, insolvency and restructuring, venture capital investment, taxation, competition, utilities, energy, media and telecommunication.

Nagy és Trócsányi is the exclusive member firm in Hungary for Lex Mundi – the world’s leading network of independent law firms with in-depth experience in 100+countries worldwide.

The firm advises a broad range of clients, including numerous multinational corporations. Among our key clients are: OTP Bank, Sberbank, Erste Bank, Scania, KS ORKA, Mannvit, DAF Trucks, Booking.com, Museum of Fine Arts of Budapest, Hungarian Post Pte Ltd, Hiventures, Strabag, CPI Hungary, Givaudan, Marks & Spencer, CBA.

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