FinMin submits bill on 2022 tax cuts

The bill will leave some HUF 750 billion in the pockets of taxpayers, the ministry said in a statement.

1. Public burdens on labour will decrease by 4 percentage points as of 1 January 2022. While in 2009, businesses had to pay 33.5% in taxes overall, this will decrease to just 13% next year, the ministry said. A 1.5% vocational training contribution will be abolished, while the social contribution tax for businesses will be cut by 2.5pp in line with earlier promises.
2. Also as of 1 January, the simplified tax form (ekho) will also change as its rate will be cut from 15.5% to 13%.
3. The bill also extends the discount on local business tax for SMEs, which will have to pay the lower 1% rate next year if the bill is passed. The rule preventing local taxes to be raised or tax benefits to be reduced will also remain in effect, and local governments will not be able to introduce new taxes in 2022.
4. The tax on small businesses (kiva) will be lowered another percentage point to 10%. Small businesses will have an estimated HUF 10 billion on this, the ministry said.
5. The government support on baby bonds will double to HUF 12,000 a year. This security is currently among the best investments as the government adds 10% of the amount saved (caped at HUF 12,000 from next year) and pays interest of 3% above the previous year’s inflation.

Cover photo: MTI/Szilárd Koszticsák