The amendment to the Local Taxes Act, which entered into force on 1 January 2015, allowed local governments to levy a municipal tax on any taxable subject within their jurisdiction that is not prohibited by law and is not subject to a statutory public tax.
In practice, municipalities have primarily levied a municipal tax on agricultural land, which increased when the moratorium expired under which municipalities were not allowed to impose new local taxes or municipal taxes for the year 2022.
On 1 September 2023, an amendment to the Local Taxes Act entered into force, terminating the right to levy municipal taxes on agricultural land, agricultural land property or property rights on agricultural land. The municipalities had to take the necessary measures until 2 September 2023 if their municipal tax decree does not comply with the provisions of the Local Taxes Act in force from 1 September 2023.
By Lidia Suveges, Attorney at law, KCG Partners Law Firm