Companies are getting tired, individual entrepreneurs are getting stronger – October company trend in light of the new tax package

The company trend predicted the need for the package

According to OPTEN data, 3.4 thousand new company court proceedings were initiated in October, nine percent fewer than in September. Although the decrease seems positive at first glance, the process is part of a long-term fatigue: the number of companies has been falling for 25 months, and the reasons for the closures are less and less competitive disadvantage, and more and more often permanent burden and loss of capacity.

Businesses do not fail, they are exhausted.

A small turnaround in foundings

The number of partnerships decreased to 495.6 thousand by the end of October, but the number of foundings increased by 18.5 percent. This is the second year in a row that the previous autumn pattern, in which October was always weaker than September, has been reversed. This shows that entrepreneurial spirit, although cautious, is responding to the stabilizing environment, and this year it is also being helped by liquidity and demand-stimulating measures that were not present last year.

Sole proprietorships set a record

In contrast to the fatigue of corporate enterprises, sole proprietorships are closing an outstanding year. In October, more than 646 thousand EVs were registered, of which 557 thousand were active – a five-year high. The suspension rate has also fallen to a record low.

The entrepreneurial community is therefore being reorganized: instead of the higher-cost corporate form, more and more people are choosing the more flexible, cheaper EV model.

Ease measures in the burdened entrepreneurial environment

The 11-point tax package brings changes that can primarily simplify the operation of smaller businesses. Among other things, the package gradually raises the threshold for individual VAT exemption, increases the value limit for simplified reporting for micro-entrepreneurs, and introduces a significant reduction in administration for 80,000 sole proprietors – together, these steps can provide real relief to the smallest, most sensitive group of entrepreneurs. Although their impact will only be measurable in the coming months, cost and administrative reductions are expected to improve the resilience of businesses and help maintain the cautious recovery that is currently visible.

“The current package does not promise a quick recovery, but supports the restoration of the resilience of businesses. The data from the company trend show that many partnerships are not leaving the market due to a decline in performance, but are tiring due to the long-term burden. In such an environment, modifications that reduce administration and create a more predictable cost level are particularly important. The slow recovery seen in the establishment of foundations indicates that the entrepreneurial spirit is there, the question now is whether the relief measures will be able to maintain this fragile momentum.”

– said Csaba Alföldi, company information expert at OPTEN.

Opten – The October value of the Company Fluctuation Index (CFI – compares the number of companies dissolved and established during a given period to those operating properly at the beginning of the period) was 12.95% nationwide. At the county level, the highest fluctuation during the period under review was produced by Budapest, Jász-Nagykun-Szolnok and Szabolcs-Szatmár-Bereg counties, while the Opten–CFI reached the lowest values ​​in Zala, Vas and Tolna counties.