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The October Tax Package

The October Tax Package

Hungary
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Due to the extended economic effects of the coronavirus epidemic, the October tax package announced by the Hungarian Government was aimed to stimulate the investing climate. According to the Hungarian ‘economic protection operational body’, there are three different ways to revive the economy (i.e.: tax reduction, simplification of the administration, boosting investments).

The small business tax will become even more advantageous from the next year. After the Government reduced it to 12% (11% from 1 January 2021), it has now been decided to double the revenue threshold HUF 3 billion. One of the tax relief decisions will exempt intermediate sellers from the tourism development contribution, which can also directly help the most affected economic sectors, such as hotels and travel agents.

About 1.5 million public administration cases will become free of charge, and from the second half of 2021, the tax authority will prepare the VAT returns for each company. Moreover, from 2021, all first-instance administrative procedures will be exempted from stamp duty. 

It is an immensely significant amendment, because the administrative costs of businesses related to the main types of taxes alone are about HUF 420 billion.

By Gabriella Galik, Partner, KCG Partners Law Firm

KCG Partners at a Glance

KCG Partners is a Hungarian business law firm providing a comprehensive range of legal services to international and local clients seeking local knowledge and global perspective. The firm comprises business-minded lawyers with sector-specific expertise, creating value for clients by applying a problem-solving approach and delivering innovative solutions.

The firm has a wealth of knowledge in corporate law, M&A, projects and construction, energy, real estate, tax, employment, litigation, privacy and forensics, securitization, estate planning and capital markets.

To address clients’ regional and international concerns, the firm maintains active working relationships with other outstanding independent law firms in Central and Eastern Europe, whilst senior counsel Mr. Blaise Pásztory brings over 40 years’ of US capital market and fund management experience.

KCG Partners Law Firm is the result of the teamwork of passionate and talented lawyers guided by the same principles and sharing the same values: 

  • Our most valuable asset is our people. They are the engine of our business and the key to our success.
  • We push boundaries by looking for innovative solutions that can empower our clients to achieve greater results.
  • We place our experience, commitment and professionalism to your service.
  • We are driven by our vision to shape and lead the Hungarian legal market and become a first choice law firm in our practice areas.

Firm's website: http://www.kcgpartners.com