Next steps for the Family Protection Action Plan: 5 percent VAT on newly built homes, plus government to cover half of renovation costs for families with kids
Stay tuned, these two steps are only the first in a long line of measures to be introduced by the Hungarian Government.
“If there are jobs and there are homes, then life is easier,” said Minister for Families Katalin Novák last week. Her statement came just after announcing that the government’s goal is to have as many Hungarian families as possible become home owners. That’s why the government has lowered VAT on newly built homes from 27 to 5 percent.
According to Minister Katalin Novák, the government’s extensive home creation program makes a significant contribution to Hungary’s economic growth and provides jobs for Hungarians. Due to the coronavirus pandemic, she said, it is especially important that there is a sector in the economy where people can earn a decent living in a decent job.
On top of this new measure, which will take effect in January 2021, Minister Novák also revealed this week that it will be possible to reclaim the 5 percent VAT for families who have purchased their home using the CSOK home subsidy. In the case of newly built real estate worth HUF 30 million, families can thus save HUF 6.6 million with the VAT discount. In the case of a larger apartment worth HUF 50 million, this sum increases to 11 million HUF. Beyond the VAT discount, reclaiming the 5 percent will leave HUF 1.5 and HUF 2.5 million extra in the family budget, respectively.
Minister Novák reminded people that, since 2015, the government has helped more than 150,000 families through the CSOK home subsidy program — to the tune of HUF 500 billion. The goal is, the minister concluded, to continue intensive support for families in the coming years.
While the VAT discounts can potentially save millions for families who have decided to purchase newly built homes, the Family Protection Action Plan’s latest step focuses entirely on supporting those who already bought homes, but don’t have the necessary funds to carry out much-needed renovations.
At a press conference last Wednesday, Minister Novák declared that beginning next January, the government will repay 50 percent of all renovation costs, up to a total of HUF 3 million for families with one or more children. She added that the details of the renovation program will be made available soon.