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Local tax havens in western Hungary

Entrepreneurs will be exempt from the local business tax and the building tax in two settlements in Győr-Moson-Sopron county, the business daily Népszabadság wrote.

Local governments in the Tápszentmiklós and Rábacsécsény (western Hungary) promised the tax exemption but in return asked local entrepreneurs to support schools in the area. The model has already been introduced in Rábacsécsény, where HUF 1-2 million is missing from the local government’s budget due to the dismissed local business tax and building tax, but at the same time, HUF 14 million has been generated from the vehicle registration tax coming from newcomers in the area, the Népszabadság wrote.

After the local government voted on the elimination of the local business tax and the building tax for two years, seven entrepreneurs relocated their headquarters to the area, mostly freight forwarding companies with a relatively large car fleet.

Because the majority of these companies relocated only their headquarters to the village but not their operation, not many new workplaces from the relocation have been created in Rábacsécsény, the paper said, however, the income generated by vehicle tax made the launch of several labor programs possible thus providing jobs to locals. (BBJ)