Tuesday, 22 November 2016

Hungary expected to reduce corporate tax rate to 9%

Hungarian Prime Minister Viktor Orbán on November 17, 2016, announced that the Hungarian government intends to introduce a new, single corporate tax rate of 9%. Under the current corporate tax regime, taxable income not exceeding HUF 500 million (approximately USD 1.8 million) is subject to a 10% rate while the excess is taxed at 19%. Although the change has not yet been enacted into legislation, based on Orbán’s announcement we expect the corporate income tax rate reduction to enter into force for 2017.
If the proposed change is enacted, the Hungarian corporate tax rate will be the lowest in the European Union and also the second lowest worldwide among countries with a corporate income tax.
Accordingly, this development presumably will foster further investments into the country.
Source: PwC