Hungary’s government is considering a 15 per cent tax on unrealised gains for wealthy Hungarians who change their tax residency and move abroad. The proposed measure would apply to assets worth more than HUF 500 million, although the details have yet to be finalised.
Taxing the rich for moving money abroad?
Hungary’s government is considering introducing an ‘exit tax’ targeting wealthy citizens who move abroad and take their assets with them, according to reports on the government’s proposed tax reforms. The measure would apply to Hungarian citizens who change their tax residency and have wealth or savings exceeding HUF 500 million (approximately EUR 1.37 million).
Under the proposal, they would face a 15 per cent personal income tax on gains accumulated since acquiring their assets, even if those gains had not yet been realised through a sale. The tax would effectively treat the assets as if they had been sold at the time of departure, triggering a tax liability on the increase in their value, writes Népszabadság.
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Different deadlines for moving within and outside the EU
The proposed rules would distinguish between those relocating within the European Union and those moving to countries outside the bloc. Hungarians moving to another EU member state would reportedly receive a ten-year deferral before having to pay the tax. Those relocating outside the EU, however, would be required to settle their tax bill in the year they leave, provided their assets exceed the HUF 500 million threshold.
The proposal is not yet final, and its details could still change. The government is expected to complete its tax package within the next week or two if it intends the new rules to take effect in January. The proposed exit tax would be separate from the government’s planned wealth tax, which is also open to public consultation.
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Hungary’s wealth tax aims to raise HUF 200 billion
Finance Minister András Kármán has argued that Hungary’s tax system places a disproportionate burden on lower-income households because consumption is taxed heavily, while wealth is taxed relatively lightly. According to the minister, wealth inequality has increased in recent years, making a wealth tax necessary to create a fairer distribution of the tax burden.
Under the current proposal, individuals with assets worth more than HUF 1 billion (around EUR 2.74 million) would pay an annual wealth tax of one per cent. A higher rate of 1.5 per cent would apply to fortunes exceeding HUF 100 billion (close to EUR 274 million), with the first payments scheduled for 2027. The government expects the wealth tax to generate HUF 200 billion (around EUR 548 million) in annual revenue, describing this as a conservative estimate.
Kármán has said the wealth tax was designed to make transferring assets abroad unnecessary, arguing that wealthy individuals could face higher corporate and income taxes in other countries. Nevertheless, officials have reportedly begun developing the separate exit-tax proposal as a safeguard against the transfer of wealth overseas. The plans remain subject to change, and it is not yet clear what the final legislation will look like.
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