Another two banks in Hungary to pass on raised and new transaction taxes
FTT hike
Earlier this month, the government has announced various fiscal adjustment measures to plug in a sizeable hole in the budget, including a raise to the financial transaction tax (FTT).
For those transactions that have already been subject to transaction tax, the tax will change from 1 August:
- in general cases (including securities transactions), the levy will be raised to 0.45% from 0.3%, with a maximum of HUF 20,000 per payment transaction (up from HUF 10,000);
- the financial transaction tax on cash withdrawals will go up to 0.9% from 0.6%.
In other words, the burden of the normal transaction tax will increase by one and a half times, and it will double for larger transactions, as the upper limit will rise to HUF 20,000 from HUF 10,000.
From 1 October, an additional transaction tax on foreign currency conversions will also come into force. If a transaction is carried out by converting between different currencies, this additional levy of 0.45%, capped at HUF 20,000, will be payable on top of the general transaction levy.
UNDER THE LAW, THE LEVY IS PAYABLE BY THE BANKS. ALTHOUGH THEY MAY PASS ON THE RAISE TO THE FTT TO THEIR CUSTOMERS, THE LAW STIPULATES THAT RETAIL CUSTOMERS CANNOT HAVE THEIR FEES INCREASED - EITHER DIRECTLY OR UNDIRECTLY - UNTIL 31 DECEMBER 2024.
MagNet, UniCredit Bank hop on the bandwagon
UniCredit Bank and MagNet Bank have announced in their notices the passing on of the additional financial transaction tax as of 1 October 2024.
For example, if a company transfers foreign currency from a HUF account - a common transaction for companies importing goods and selling them domestically - the FTT and the additional FTT will be charged separately, so there's a threefold increase (from 0.3% to 0.45 + 0.45%). The maximum amount of the FTT will then be four times higher (growing from HUF 10,000 to HUF 20,000 + 20,000).
