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Government extends 5% preferential VAT rate for home construction

Finance Minister Mihály Varga said a 5 percent preferential VAT rate for home construction which has been extended until the end of 2024 could be applicable up until December 31, 2028 provided that construction begins by 2024.

Minister Varga said on Facebook that the preferential VAT rate saves taxpayers HUF 200 billion (EUR 487.4m) a year. The extension of the preferential VAT rate until the end of 2028 has been initiated by construction industry association ÉVOSZ, the minister said.

According to ÉVOSZ’s proposal, the VAT rate should remain applicable if a home building permit is approved by the end of 2024 or if construction on the home in question begins by then, he said. The finance ministry has examined and approved the association’s request, Minister Varga said, adding that the proposal could go before parliament in the autumn.

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