Mihaly Varga, Hungary’s Minister of National Economy, announced about decision of government to reduce the corporate tax rate lower than 10 percent next year.
On November 18, behind the scenes of the Regional Digital Conference in Budapest, he made the announcement during which he unveiled the plan of the government to impose a single rate for nine percent of the corporate tax.
Now, the headline shows, that the rate of Hungary of the corporate tax constitutes 19 percent, and there is lower level of the income tax of 10 percent on the first 500 million Hungarian forints (1.7 million US dollars) of the income.
Dramatic movement would give Hungary one of the lowest corporate tax rates in the world and one of the lowest in the European Union “onshore” jurisdictions.
Varga said that this measure will save companies about 145 billion HUF (500 million US dollars) a year tax. The Government expects to compensate the shortfall through controlled growth to increase tax revenues.
The government plans to introduce a new tax rate of 1 January 2017.