Prime Minister Viktor Orbán of Hungary announced an 11-point entrepreneurial and tax-cut package agreed with the Hungarian Chamber of Commerce and Industry (HCCI) at a press conference in Budapest, Hungary, on Monday, 17 November.
The Prime Minister said the tax cuts included in the agreement are estimated to be worth between 80 and 90 billion HUF. ‘We will reduce the tax burden on entrepreneurs and cut the bureaucracy they face,’ he added.
Speaking alongside the President of the Chamber, PM Orbán recalled that the first major step in the support package was the introduction of a subsidized loan for businesses with a fixed 3-per-cent interest rate. In this second phase, at the Chamber’s request, the government and HCCI have now agreed on 11 additional measures.
The eleven points are as follows:
- Gradual increase of the VAT-exemption threshold. Orbán said the threshold will rise to 20 million HUF in 2026, 22 million in 2027, and 24 million in 2028. ‘These are rising figures, which is good news,’ he said, adding that this represents not higher burdens but greater available benefits.
- Higher flat-rate expense allowances. The general deductible cost ratio for flat-rate taxpayers will increase to 45 per cent in 2026 and 50 per cent in 2027. Talks on the 2028 rate are still ongoing.
- Lower social contribution tax rate for full-time sole proprietors. According to government estimates, this will reduce the monthly tax burden for roughly 140,000 entrepreneurs.
- Expansion of eligibility for the small business tax (KIVA). PM Orbán said this change will allow an additional 4,000–5,000 businesses to enter the preferential tax regime.
- A 100-million-HUF tax allowance for environmental remediation and green investments. ‘To put it simply,’ Orbán said, ‘if someone undertakes a brownfield investment and must reduce environmental impact or repair earlier damage, they can deduct the cost from their taxes.’ He expressed hope that this would boost brownfield development.
- Tax incentives for modernizing energy infrastructure. Large energy suppliers will receive tax benefits to encourage investment in modernizing their networks, thereby supporting businesses. The Prime Minister said he hopes companies will act according to their ‘business logic’—that is, reinvest rather than increase profits.
- Higher retail tax brackets. Adjusting these thresholds will ease the tax burden on around 3,500 retail businesses, he said.
- Six-month postponement of the planned fuel excise tax increase. PM Orbán admitted he accepted this ‘with a heavy heart’. While the tax should, in principle, rise in line with inflation as of 1 January, the chamber requested a delay. The government will revisit the matter mid-year. According to the Prime Minister, the postponement will cost the budget around 20 billion HUF in lost revenue.
- Reduced administrative burdens for companies. The threshold for corporate tax advance payments will rise from 5 million to 20 million HUF, benefiting some 20,000 firms.
- Higher limit for simplified reporting by micro-businesses.The reporting threshold will increase from 150 million to 180 million HUF, allowing roughly 10,000 businesses to choose simpler, faster administration.
- Automatic registration and reduced reporting frequency for 80,000 sole proprietors. The National Tax and Customs Administration (NAV) will automatically register these entrepreneurs and reduce the frequency of social security and contribution filings to quarterly.
At the press conference, Prime Minister Orbán went on to stress that the 80–90 billion HUF in additional costs associated with the package will be covered by higher banking taxes.
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