The Hungarian government on November 21, 2024, issued Government Decree 356/2024 (XI. 21.) amending previous guidance on “extra-profit taxes.”
Key changes include:
- Credit institutions and financial enterprises will continue to be subject to the extra-profit tax in 2025. The tax base for 2025 will be determined based on the pre-tax profit from the 2023 financial statement, adjusted for specific items. The tax rate will be 7% on the tax base up to HUF 20 billion and 18% on amounts exceeding this threshold. The decree also includes provisions for reducing tax liability through the purchase of government bonds.
- The additional insurance premium tax is extended to 2025, with rates of 3% for non-life insurance premiums and 2% for life insurance premiums on the tax base up to HUF 48 billion. For amounts exceeding HUF 48 billion, the rates are 14% for non-life insurance premiums and 6% for life insurance premiums. Insurance companies must declare and pay the surtax in two instalments by January 31 and July 31, 2026, with an advance due by December 10, 2025. The tax liability can also be reduced by purchasing government bonds.
- The income tax rate for energy suppliers remains at 41% in 2025.
- Retail tax regulations from 2024 are extended to 2025.
- The 95% special tax rate on the Brent-Ural spread for petroleum product suppliers continues in 2025.
- Several special taxes will be phased out as of January 1, 2025, including the special tax on petroleum product suppliers’ net sales revenue, the special tax on energy producers using renewable energy sources, the special tax on balancing control capacity, the extra-profit tax of pharmaceutical companies, the special tax of pharmaceutical companies, the special tax of pharmaceutical distributors, the Robin Hood tax for manufacturers in the processing industry, the extra-profit tax on telecommunications, and the extra mining fee.
Read a December 2024 report prepared by the KPMG member firm in Hungary