Tax benefits for primary producers to increase further this year

(Illustration: AI)

The 11 percent minimum wage increase therefore also brings benefits to the relevant actors in agriculture, announced István Nagy, Minister of Agriculture, on his social media page. The minister emphasized that it is particularly important for primary producers active in agriculture that since the agrarian reform introduced in 2021, the tax thresholds automatically follow the development of the minimum wage. As a result, the annual income level below which primary producers are fully exempt from personal income tax liability will increase further in 2026, or their actual tax liability will arise later. Based on the new thresholds, if the primary producer qualifies as a flat-rate taxpayer as defined in the Personal Income Tax Act and his income from his activities in 2026 does not reach HUF 1,936,800, he will not have to calculate income and will not have to submit a tax return in 2027. If his annual income exceeds HUF 1,936,800 but does not reach HUF 19,368,000, he will have to calculate income but will not have to pay tax. Our main goal is to ensure the profitability and development of small and medium-sized farms with as many means as possible. Many elements of the agricultural support system serve this purpose, both in terms of direct and development support. Among them are simplified investment applications in the fields of horticulture, animal husbandry and food processing, which are very popular among the affected producers and are adapted to smaller farm sizes – added István Nagy.

The favorable changes also affect family farms

Flat-rate taxation can still be widely applied, and the rising thresholds provide a more predictable operating environment for agricultural producers. This is important for smaller farms, especially in the midst of weather risks and market uncertainties. Tax benefits for primary producers working in the beekeeping sector will also remain unchanged, which contributes to strengthening the competitiveness and survival of domestic beekeeping. The aim of the regulation is to ensure that the income from work in agriculture remains with the producers as much as possible – he explained. The Minister highlighted that the suppressed inflation, tax cuts, the expanding system of family tax benefits, the home creation support available on favorable terms for primary producers, the benefits and simplifications provided by the Family Farms Act, and the legislative environment that also facilitates generational change, together with the January wage increases, ensure that the livelihood and income conditions of those working in agriculture, as well as the conditions of their activities, will improve significantly in 2026. The government has consistently supported the increase in minimum wages in recent years and continues to work to ensure a stable, predictable and fair economic and tax environment for all agricultural producers.

AM