Changes to Tipping Regulations in Hungary

By: Trademagazin Date: 2024. 12. 02. 11:20

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The Ministry of National Economy, in collaboration with professional associations, is introducing new measures to cap service charges and ensure the tax exemption of tips. Under the proposal, hospitality businesses may charge a maximum service fee of 15% for individual customers and up to 20% for corporate events.

These measures aim to increase the competitiveness of the hospitality sector and strengthen its ability to retain workforce.

Key Points of the New Tipping Regulations

Tax Exemption: The legislative amendments ensure that tips can be received tax-free regardless of the payment method. This means that whether a tip is given in cash or via electronic payment, it will be exempt from taxes and contributions.
Optional Service Charges: The application of service fees remains optional; hospitality businesses can decide whether to implement them. If applied, the fee’s amount must be clearly stated on menus and other communication platforms.
Difference Between Service Charges and Tips: It is crucial to note that a service charge is not the same as a tip. The service charge is part of the bill and a revenue for the business, whereas tips are voluntary payments given directly to the server by the customer.