- The European Commission is calling on Hungary to abolish its retail tax regime to comply with the right of establishment
- Hungary is being sent a letter of formal notice for failing to bring its retail tax regime in line with EU laws
- Foreign controlled retail companies in Hungary are subject to high and steeply progressive tax rates on their turnover
- Domestic retailers operating under franchise systems are not subject to the same highest rates
- The retail tax regime prevents foreign controlled companies from restructuring their business operations
- Hungary committed to phasing out the retail tax regime in its Recovery and Resilience Plan, but has failed to do so
- Hungary has consistently prolonged the tax measure and increased the highest tax rates under the regime
- Hungary has two months to respond to the Commission’s letter of formal notice or may face further action.
Source: ec.europa.eu
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
