New retail specific tax - foreign online stores are also affected

A new special retail tax for replenishing the Epidemiological Fund has been introduced by the Hungarian Government. It enters into force on 1^st May 2020.

Although it seems to be obvious from the name that the aim is to tax retail, it is nevertheless worth investigating exactly who may be affected by this special tax.

Pursuant to the currently available information, in addition to the classic retailers, the tax liability may also apply to 

- those wholesalers, who are also willing to sell to private individuals,

- foreign companies with only Hungarian tax (VAT) registration,

- Domestic sales activities of non-resident organizations and persons, other than through a branch.

And once we have determined whether we are subject to the new special retail tax, we must deal with the tax itself.

It needs to be clarified, for example, that for which period it applies, on the basis of which turnover it should be calculated, how it should be proportionated, and it is extremely important that the monthly tax advance payment shall be declared and paid by the first deadline of 31^st May 2020 and, how this tax advance payment can be reduced, if necessary.

We have tried to answer these questions in our current publication, in which, in addition to the interpretation of the legislation, we also provide practical examples for calculating the tax base and the tax advance, as well.

The complete publication is available here: