Hungary COVID 2.5% retail turnover tax on ecommerce

Hungary is to relaunch its retail turnover tax, which includes both high street and online retailers. Non-resident ecommerce sellers, targeting Hungarian consumers, are also liable to the tax.  

Unlike VAT, which is charged on the consumer, the retail tax is payable by the retailer.

The implementation date is 1 May 2020. It is intended to be a temporary tax for the coronavirus pandemic; although there is no set end date.

The tax is levied in a scale depending on the retailer’s annual sales:

• 0.0% - sales below HUF 500m
• 0.1% - sales between HUF 500m and HUF 30bn
• 0.4% - sales between HUF 30bn and HUF 100bn
• 2.5% - sales above HUF 100bn

The sales calculation is based on rolling sales total for the previous 12 months starting from the beginning of the crisis – deemed to be 11 March in Hungary. Liable retails must make montly advance payments. The first payment and filing is due by 31 May 2020.

Avalara offers a Hungary Retail Tax calculation and filing service in addition to its VAT registration and returns service. Contact us if you would like details of the new tax and our filing service.