“The Hungarian standpoint has been consistent throughout: We made it clear that we would only adopt a global minimum tax that does not lead to a tax increase in Hungary, does not endanger the competitive advantage of the Hungarian economy, and protects the workplaces of the Hungarian people," he stated.
Two-and-a-half years of work relating to over 100 proposed text amendments has come to fruition. Of these, the minister highlighted the three most important points: According to one, the rate of corporation tax will not be changing and will remain at 9 percent; Hungary will be able to collect the global tax using a targeted solution.
We also succeeded in achieving that real business activities do not have to be taxed. This means that company assets and wage payment may be deducted from the rate of tax using a special method of calculation, meaning companies that perform activities that involve actual assets and the actual payment of wages, as opposed to fictive activities, will be eligible for this concession.
According to the Minister, the third result of the agreement is that a special rate of tax will be valid for a transitional period of 10 years, meaning that for a period of ten years the rate of tax will be calculated using a reduced tax return and using a reduced tax credit.
“We have achieved a major result, and I can safely say that a Hungarian success has been realized; we were right to decisively represent our interests," Mr. Varga said, adding that “thanks to this, a compromise has come about that we are able to join wholeheartedly."