The 197/2022 (VI. 4) Government decree of Hungary provides details on extra-profit taxes and the rules of application related to them. We aim to introduce the most important changes affecting certain types of taxes, as well as to offer first-hand information to our readers.
According to the latest announcements, individual special taxes, extraordinary taxes, and increased types of taxes will be applied in the current and the upcoming tax year.
In the following, we intend to present those changes that affect a wider range.
Changes affecting company car tax
Between 1 July 2022 and 31 December 2022, the monthly rate of company car tax will increase for passenger cars as follows:
|Performance (kW)||Cars with environmental class mark „0” – „4”||Cars with environmental class marks „6” – „10”||Cars with environmental class mark „5” or „14” – „15”|
|0-50||HUF 30,500||HUF 16,000||HUF 14,000|
|51-90||HUF 41,000||HUF 20,000||HUF 16,000|
|91-120||HUF 61,000||HUF 41,000||HUF 20,000|
|over 120||HUF 81,000||HUF 61,000||HUF 41,000|
As a general rule, the company car tax must be assessed every quarter for each month in which the tax liability existed. Based on this information, the increased amount of tax must first be established, declared, and paid for July, August, and September by October 20th, 2022, via declaration form No. 2201.
Changes affecting simplified employment
The main changes in simplified employment have been the level of the public burden to be paid by the employer.
Based on the changes, the public charge to be paid will be as follows from July 1st, 2022.
- in the case of seasonal agricultural and tourist work, 5% of the current minimum wage per employee for each calendar day must be paid, which is HUF 1,000.
- in the case of casual work, 1% of the current minimum wage per employee for each calendar day spent in employment (i.e., HUF 2,000).
- in the case of simplified employment of a movie/film industry extra, 3% of the current minimum wage per employee rounded for each calendar day must be paid (i.e., HUF 6,000).
Unlike the Simplified Employment Act, the daily net income of a film industry extra may not exceed 12% of the minimum wage per day, which is currently HUF 24,000.
As the public burden changes, the calculation bases for retirement benefits change as well:
- in the case of seasonal agricultural and tourist work, the calculation of the pension is 1.4% of the minimum wage per day, so this amount is from HUF 1,370 to HUF 2,800 per day.
- in the case of casual work, 2.8% so it rises from HUF 2740 to HUF 5,600 a day.
The increased public charges will be paid for the first time in the case of the simplified employment relationship created in July 2022.
Changes affecting the Public Health Product Tax (NETA)
In the case of NETA, the new legislation has increased the level of the tax per product. The tax on individual products is set out in Annex 2 of the Government Decree on Extra profit Taxes.
To give some illustrative examples: in contrast to the HUF 15/litre tax paid so far for soft drinks, the tax rate will be HUF 23 under the new rule. The tax content of energy drinks depends on the type: one increases from HUF 50/litre to HUF 65/litre, while the other increases from HUF 300/litre to HUF 390/litre.
The tax rate for savoury snacks is to get higher from HUF 300/kg to HUF 390. The tax on flavoured beer increases from HUF 25/litre to HUF 33/litre.
As of 1 July 2022, the heading of the Combined Nomenclature in force on 15 May 2022 shall be considered, which is specified in Annex I to Council Regulation (EEC) No 2658/87 of 23 July 1987 on the tariff and statistical nomenclature and the Common Customs Tariff.
The concept of syrup is changing also, with the addition of a sweetener. It is worth examining with an expert how the range of taxable products distributed by taxpayers changes due to the amendment of the legislation and thus the tax rate applied in their case.
Changes affecting the retail tax
Regarding the changes in the retail tax, the novelties can be divided into two parts.
On the one hand, in the tax year covering 1 July 2022, retail taxpayers will have to pay an additional tax of 80%. The surcharge is based on the annual amount of retail tax for the tax year beginning in 2021 based on the calendar days of the tax year – 80% of which must be paid by businesses as a one-off surcharge by 30 November 2022.
In addition, for the tax year beginning in 2023, the regulation increased the rate of retail tax as follows.
|Tax base||Tax rate so far||Tax rate from 2023 onwards|
|For the part not exceeding HUF 500 million||0%||0%|
|After the part between HUF 500 million and 30 billion||0.1%||0.15%|
|After the part between HUF 30 billion and 100 billion||0.4%||1%|
|After the part over 100 billion||2.5% / 2.7%||4.1%|
Other sectoral tax changes
The new regulation also imposed special and additional taxes on certain sectors and increased the rates of existing taxes.
For example, the tax on banks and credit institutions is changing, with a special tax being paid by petroleum producers and some players in the energy sector. Excise duty also increases for certain products (in the case of targeted use of tobacco and alcohol products and certain energy sources).
A special tax was levied on air passenger transport activities and the contribution specified in the Act on the Provision of Economical and Medicines and Medical Aids and the General Rules for the Distribution of Medicines was increased. Manufacturers in the manufacturing industry (bioethanol producers, starch producers, and sunflower oil producers) were also subject to the income tax on energy suppliers for the tax years 2022 and 2023.
An additional tax has also been introduced in the telecommunication sector, and insurers on insurance tax also must pay additional tax. In addition, the rules on mining royalties have changed.
If you have any questions on the tax changes or wish to examine how your company is affected by each tax increase, special tax, and additional tax, please do not hesitate to contact us!