On January 27, the AmCham Tax Committee held its first meeting of the year in the online space, with high attendance. The Chamber have begun to prepare its annual recommendation package, in which taxation is always a high priority. As such, apart from current issues, committee members also discussed several items of recommendations, under the leadership of Committee Chair Károly Radnai (Andersen).
The agreement on a Global Minimum Tax (GMT) is undoubtedly one of the most important current issues of the international tax system. However, there are still many open questions regarding the application and implementation of this new policy. Recently, the EU has published a draft of its proposed GMT regulation package, and in connection to this draft, our committee discussed several questions about its applicability to the Hungarian taxation system. Many details are not yet clear in determining the tax base, the possibility of offsetting certain items and current types of taxes.
As some questions are currently still open for discussion, Mr. Radnai indicated the need for an exchange of views with the representatives of the Ministry of Finance on these issues.
There is another new EU draft regulation that aims to control whether companies which have a formal presence in a given country, but do not officially have tangible activities there are excluded from the tax-planning process. Members agreed that this would also be another topic to raise at a meeting with the Ministry.
Regarding other current tax matters, the Committee discussed ongoing developments such as the suspension of the ‘Electronic-VAT’ system, and whether it will be resumed in the future; whether there are steps planned towards the further digitalization of tax; and whether there are plans to further integrate the local tax (hipa) administration into NAV from a taxation perspective. These are also issues that need further clarification with legislators.
We would like to thank Károly Radnai, Chairman of the Tax Committee for leading the discussion, and to our members for their attendance and their valuable input.
The AmCham Tax Committee will continue to work together to further discuss common taxation issues and recommendations.