The Hungarian parliament adopted a huge VAT reduction tax package for 2017 that leaves on average HUF 80-85 000 per year at families with two children.
According to Minister for National Economy Mihaly Varga, about one-third of tax reductions stemmed from lowering VAT on certain products and services, while two-thirds came from the increasing of allowances for families with children.
In 2017, VAT on poultry, eggs and fresh milk will be cut to five percent, while that on internet and restaurant services will be reduced to 18 percent. As a result of these measures, some HUF 55bn more is expected to be left at households.
Small enterprises will also benefit from the package via its business-friendly inventions. Thanks to the new, simplified fringe benefit scheme, in 2017 more than 4 million employees may receive HUF 100 000 per year in cash. Besides that amount, HUF 100 000 and HUF 350 000 per year may be transferred to the travelling and entertainment vouchers of public sector and private sector employees, respectively.
