VAT Rates in Hungary: An Overview

Understanding the Rates

Hungary's VAT system operates with two main rates: a general rate of 27% and a reduced rate of 18%. The general rate applies to most goods and services, while the reduced rate is used for certain specific categories, such as certain food products and dairy products.

Exemptions and Reduced Rates

Some products and services are exempt from VAT in Hungary, including healthcare, education, and financial services. Additionally, zero-rated VAT treatment may be applicable for certain exports, intra-EU supplies, and international transport services.

VAT Registration and Compliance

Businesses that meet certain turnover thresholds are required to register for VAT in Hungary. Once registered, they are responsible for filing regular VAT returns, charging VAT on taxable transactions, and claiming back VAT on eligible input expenses. Failure to comply with VAT regulations can result in penalties and fines.