Government could raise VAT exemption revenue threshold
The government could raise the annual revenue threshold for VAT exemption for small businesses from 8 million to 12 million forints (EUR 38,600), Economy Minister Mihály Varga said in a statement on Sunday.
The government has already started consultations on the matter with the European Commission and has requested a derogation from the 8.8 million forint threshold in Hungary’s accession treaty, Varga said. Brussels earlier approved higher thresholds for Luxembourg, Latvia, Slovenia, Romania and Italy, he added.
More than 605,000 businesses would benefit from the measure, saving them 25 billion forints, Varga said. The threshold could be raised as early as January 1, 2019, he added.
Varga noted that the government had raised the revenue threshold for the itemised tax for small businesses, known by its Hungarian acronym “kata”, from 6 million to 12 million forints from the start of 2017.
Businesses that opt for kata pay a flat monthly 50,000 forints instead of corporate or payroll tax.