As announced at the Government Briefing on 26 May 2022, as part of a larger tax package, the Government decided to reimpose the Advertisement Tax, previously suspended. The tax will be based on Net Sales, and will be payable on the part of Net Sales exceeding HUF 2.5 billion. The tax base for this year is the current year. The relevant law will enter into force on 1 January 2023.
The sectoral tax on advertising was first introduced in 2014. It was later challenged by the European Commission because of its progressive nature, which it believed could create an unfair competitive advantage for certain businesses. Before the conclusion of the EU proceedings, the Advertisement Tax was amended several times, until 12 July 2019, when the Hungarian Parliament adopted the so-called “Omnibus Act” on the Amendment of Certain Tax Laws and Other Related Laws, which reduced the Advertisement Tax rate to 0% in the tax period between 1 July 2019 to 31 December 2022, and abolished certain administrative obligations related to the filing of tax returns.
With its current reintroduction, the Government expects to raise HUF 15 billion in budget revenue.