The government may raise the annual revenue threshold for VAT exemption for small businesses by HUF 4 million to HUF 12 mln, Minister for National Economy Mihály Varga was reported as saying yesterday by state news wire MTI.
The annual revenue threshold would be lifted from the current HUF 8 mln to HUF 12 mln, Varga said. More than 605,000 businesses would benefit from the measure, saving them a total of HUF 25 billion, he added. The threshold could be raised as early as January 1, 2019, Varga was quoted as saying.
The government has already started consultations on the matter with the European Commission and has requested a derogation from the HUF 8.8 mln threshold in Hungaryʼs accession treaty, Varga said. Brussels earlier approved higher thresholds for Luxembourg, Latvia, Slovenia, Romania and Italy, he added.
Varga noted that the government had raised the annual revenue threshold for the itemized tax for small businesses, known by its Hungarian acronym KATA, from HUF 6 mln to HUF 8 mln as of this year. Businesses that opt for KATA pay a flat monthly HUF 50,000 instead of corporate or payroll tax.