Consumption/VAT/Sales Tax in Hungary

Overview by
Nature of the Tax
ÁFA : Általános Forgalmi Adó
Standard Rate
Reduced Tax Rate
A 5% rate applies to pharmaceuticals and certain medical equipment, aids for the blind, books and newspapers. A 18% rate applies to hotel and basic foods.
Exclusion From Taxation
The conditions of the subjective tax exemption are: national seat or domicile and the income of the previous year is under 4 million HUF. The types of the objective tax exemptions are listed in Annex 2 of the VAT Act.
Method of Calculation, Declaration and Settlement
Since the VAT is only paid after the value added, the paid VAT can be deducted from the received VAT if the product or service is used for manufacturing other products or providing other services (with some exemptions listed in Section 33 of VAT Act). Generally, companies should submit VAT returns quarterly. However, depending on prior years’ revenues from the sale of goods and provision of services some companies may need to submit their VAT returns yearly or monthly. For more information, you can consult the Hungarian Tax and Financial Control Administration's website.
Other Consumption Taxes
Excise tax is levied on items such as alcoholic beverages, petrol and tobacco products.

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Experts Views (1)
  • EU VAT Guide

    With 27 EU Member States, each with their own VAT legislation to consider, VAT can be a time consuming and confusing task for international business.

    Accordance on 24 Jan 2012 related to Consumption/VAT/Sales Tax in Hungary

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