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Significant Minimum Wage Increase Expected in Hungary

Significant Minimum Wage Increase Expected in Hungary

Hungary
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HUF 200,000 might be the new general gross minimum wage from 2022 in Hungary. Informal consultation between the Government and the National Association of Entrepreneurs and Employers has already begun with regard to a new, long-term agreement on minimal wages. The official negotiation process should also be started by 15 September 2021.

According to the initial comments from the parties involved, it is expected that the gross general minimum wage would be increased to HUF 200,000 (per month), while for more qualified positions (jobs requiring at least a secondary education or a secondary vocational qualification) the so-called guaranteed wage minimum would reach gross HUF 260,000 (per month). In both cases this would mean an increase of 19%.

The employees are expected to be compensated for the material increase with a similarly material decrease of tax burden on wages. The details of an eventual tax reduction are not yet communicated, however, in 2016, when the last similarly significant, long-term minimum wage programme had been concluded, the social contribution tax was cut by 5% as well.

By Balint Zsoldos, Head of Tax, 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