Hungary: Parliament Approves VAT Cuts for 2017
On June 7, 2016, the Hungarian Parliament approved Bill T/10537, a supplementary tax package to the Ministry of Economy’s 2017 budget. As previously reported, the bill applies a 5% reduced VAT rate to sales of poultry, fresh milk, and eggs, an 18% reduced VAT rate to restaurant services, and an 18% reduced VAT rate to internet access services, effective January 1, 2017. Restaurant services will be further reduced to 5% in 2018, absent further legislation. Finally, the bill reduces the threshold for registration as a taxable person from HUF 1 million to HUF 100,000. The VAT cuts are intended to reduce the tax burden on working families, and to spur economic growth.