Sectoral special taxes are part of our life since the financial crisis of 2008, further as of the summer of 2022 there are extra burdens, extra-profit taxes, introduced in certain sectors. Companies operating in the financial, banking, and insurance sectors, in the energy sector, in aviation, in telecommunication, and in the pharmaceutical industry, further in the retail sector, had to take a larger part than before in maintaining the balance of the central budget.
In the periods when the stability of the budget
is threatened, special taxes provide the state more flexibility for corrections
than "traditional" types of taxes.
It was originally planned that these will be
taken out from the system by 2024, which, has not been realized, however at the
same time, the rules have been refined at several points, which may even create
a more favourable situation for the parties affected.
Pharmaceutical manufacturers
Based on the rules as of 2022, the basis of the
special tax is the net sales revenue determined based on the annual financial statement
in accordance with the Act on Local Taxes, however the consideration from the
royalty does not form part of it. The rate of the tax is banded and
progressive.
Based on the current changes, the extra profit
tax will remain in the next year as well, however as of January 1, 2024, the
rate of the special tax on pharmaceutical manufacturers will be reduced to the
half of the previous period.
·
0.5%
up to HUF 50 billion tax base (instead of 1%)
·
1.5%
between HUF 50 - 150 billion (instead of 3%)
·
Above
HUF 150 billion, it will be 4% instead of 8%.
Further, pharmaceutical manufacturers can
reduce their special tax by 50% with the costs of their capital investments and
R&D activities affecting the health sector.
In the case of pharmaceutical distributors, the
rate of special tax on medicines with a manufacturer's price exceeding HUF
10,000 has increased from 28% to 40%, however as good news for them, as of July
1, 2023, half of the 40% special tax on distribution will be waived, if the parties
have spent this amount on the activities listed above.
According to the current summer decree, the
special tax will be taken out from the system by the end of 2024.
Banking sector
The amount of the special tax affecting the
banking sector can be reduced by purchasing Hungarian government securities,
thereby encouraging the actors to support the central budget. In the second
half of 2023 and in 2024, the extra profit tax base for banks and financial
companies is the earnings before tax of the 2022 business year, which must be
corrected with several items.
Reducing items:
·
the
amount shown as dividend income in 2022
·
the
profit from non-ordinary activities in 2022
Increasing items:
·
bank
tax, transaction tax and extra profit tax charged to the result of 2022
Tax rates:
·
In
the second half of 2023, 13% below HUF 10 billion, 30% above of this amount
·
As
of 2024, the tax rates will remain unchanged, however the value threshold will
increase from HUF 10 billion to HUF 20 billion.
Thanks to the mentioned changes, if banks and
financial enterprises increase their holdings of government securities
sufficiently according to the regulations, they can reduce their tax liability to
the half of it.
Special retail tax
All retail activities are considered as taxable
retail activities regarding the special retail tax. Persons and organizations
with foreign or domestic residences carrying out taxable retail activities in a
business-like manner are subject to the tax. The basis of the tax is the net
sales revenue from taxable activities in the tax year.
The band taxation of the retail tax burdening
the sector will remain.
The following rates will be in effect in 2024:
·
Tax
base up to HUF 500 million 0%
·
0.15%
for tax base between HUF 500 million and HUF 30 billion
·
1%
for tax base between HUF 30-100 billion
·
4.5%
for tax base over HUF 100 billion (this is only 4.1% in 2023).
Telecommunications sector and airlines
In 2024, extra-profit taxes affecting the
telecommunications sector and airlines will not change.
The taxpayers of the tax affecting the
operators of the telecommunications sector must determine, pay and declare an
additional tax advance payment for the tax year starting in 2024 equal to the
additional tax determined for the year 2023 by the last day of the fifth month
of the tax year starting in 2024 (until May 31 for taxpayers determining the
tax obligations based on the calendar year). In 2023, the tax to be paid is determined
based on a progressive rate according to the net sale revenue of the local
business tax:
·
0%
up to HUF 1 billion tax base
·
0.1%
for the tax base between HUF 1-50 billion
·
3%
for the tax base between HUF 50-100 billion
·
7%
for the tax base over HUF 100 billion.
The special tax for airlines will remain in the
future, without an expiration date, it will be valid as a green tax (eco-tax)
like in other EU countries, since air transport is mandatorily exempted from
excise tax at the EU level, so it is possible to compensate for the pollution
emissions caused by them. The economic organization performing ground handling
is obliged to pay the contribution of the airlines after the taxable activity.
The amount of the contribution depends on the number of passengers of the
aircraft and their final destination.
·
After
traveling passengers to the European Union, as well as to Albania, Andorra,
Bosnia and Herzegovina, North Macedonia, Iceland, Kosovo, Lichtenstein,
Moldova, Monaco, Montenegro, the United Kingdom, Norway, San Marino,
Switzerland, Serbia and Ukraine:
o
HUF
1,600 must be paid per passenger if the emission value per seat is lower than
10.5 kg
o
HUF
900, between 10.5-17.5 kg emission value
o
HUF
200, over 17.5 kg of emission value
·
to
countries other than those defined above
o
HUF
3,900 must be paid per passenger if the emission value per seat is lower than
10.5 kg
o
HUF
750, between 10.5-17.5 kg emission value
o
HUF
600, over 17.5 kg of emission value.
The aircraft operator is obliged to send the
data required for tax assessment to the air service organization every month,
failing this obligation, the highest tax rate depending on the direction of the
travel must be calculated. The contribution must be determined, declared and
paid monthly, by the 20th day of the following month.
Carbon dioxide quota tax (ETS)
Finally, the decree published on July 17, 2023
introduced also a new special tax for the largest carbon dioxide emitters,
primarily for the cement, fertilizer, steel, glass manufacturers, oil
refineries, chemical and metal industries.
In the year preceding the current year,
companies receiving free emission allowance allocations equal to at least 50%
of the average of the total emissions of carbon dioxide certified in the
previous three years are obliged to pay the tax if, in the three years
preceding the current year, their certified annual average carbon dioxide
emissions exceeded 10,000 tons. The tax must be paid for the current tax year
as well, i.e. starting after December 31, 2022.
The carbon dioxide quota tax rate is EUR 40 for
each ton of CO2 emitted, plus a 10% transaction fee is due based on the
transfer of free quotas (EU Emissions Trading System, ETS) according to the
EEX-EUA exchange rate of the quota on the given day at the valid HNB (Hungarian
National Bank) exchange rate.
The relevant administration (reports per
transaction) must be completed to the authority responsible for climate
protection, and the transaction fee must be paid to the account of the ministry
responsible for energy policy.
The carbon dioxide quota tax base and the tax
must be determined per tax year and declared by May 31 of the year following
the tax year, the tax advance must be declared quarterly and paid quarterly by
the 15th day of the second month following the relevant quarter year.
The tax base can be reduced by 50%:
§
if
the level of production with CO2 emissions is at least 90% of the capacity
belonging to the main activity contained in the taxpayer's unified
environmental use permit,
§
the
capacity of the main activity has not decreased compared to the capacity of the
year before the current year (as stipulated in the unified environmental use
permit), and
§
CO2
emissions per unit of manufactured product decreased by the same amount as the
linear reduction factor of the ETS (used in the European Union's emissions
trading system) in effect in the current year.
