From Januar all local business tax breaks and exemptions eliminated

In its latest Tax and Legal Alert on Monday, PricewaterhouseCoopers detailed the implications.

 Due to the requirements of harmonizing Hungarian regulations with Community legislation, local business tax breaks and exemptions offered by municipal authorities were eliminated with effect from 31 December 2007, under Act L of 2001 on the Amendment of Financial Legislation. Accordingly, from 1 January 2008, businesses that had previously been granted tax breaks or exemptions by municipal authorities will be required to pay local business tax.
After 1 January 2008, only businesses with a tax base not exceeding HUF 2.5 million may be granted local business tax breaks or exemptions, under terms set out in decrees issued by the municipal authorities.