The government publishes a decree on exceptional taxes

The Hungarian government on Saturday issued a decree detailing temporary taxes on “additional profit” companies in the banking, insurance, energy, retail, telecommunications, air transport and pharmaceutical that will pay in 2022 and 2023, according to a report by state news wire MTI.

The decree obliges banks to pay a special net income tax of 10% in 2022 and 8% in 2023.

The decree applies the financial transaction tax to securities transactions at a rate of 0.3% but not more than HUF 10,000 per transaction.

The decree levies a 25% tax on the difference between Russian crude and Brent for refining companies.

The decree obliges airlines to pay a contribution of 3,900 HUF per passenger for travelers on flights to European Union countries as well as destinations in Albania, Andorra, Bosnia and Herzegovina, North Macedonia, Iceland, Kosovo, Liechtenstein, Moldova, Monaco, Montenegro, United Kingdom, Norway, San Marino, Switzerland, Serbia and Ukraine. The contribution for other destinations is 9,750 HUF per passenger.

The decree obliges telecommunications companies and insurers to pay progressive “substitution taxes”.

Economic Development Minister Márton Nagy said in a public radio interview that the windfall taxes would bring in more than HUF 800 billion in 2022 and generate budget revenue of up to HUF 1 tln in 2023.

Income from windfall taxes will be channeled into funds supporting the regulated household utility pricing system and the modernization of Hungary’s military defence.

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About Eleanor Blackburn

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