Hungary operates a value added tax (VAT) system known locally as Általános forgalmi adó (ÁFA). Hungary has been an EU member state since 2004, and its VAT framework is fully aligned with EU VAT Directive principles.
Hungarian VAT is governed primarily by Act CXXVII of 2007 on Value Added Tax and related regulations. VAT is administered by the National Tax and Customs Administration of Hungary (NAV). NAV is responsible for issuing guidance, processing VAT registrations and returns, operating Hungary’s real-time invoice reporting system, and enforcing VAT compliance.
Businesses carrying out taxable activities in Hungary — whether resident or non-resident — must comply with Hungarian VAT obligations. This includes VAT registration where required, applying the correct VAT rates, issuing VAT-compliant invoices, maintaining records, and filing periodic VAT returns.
