Finance Minister Mihály Varga announced that next year’s budget bill will provide coverage for a number of tax breaks.
The PIT exemption of young people under the age of 25 is one of the most important steps of the government’s Action Plan to Reboot the Economy. According to the minister, the measure will help young people start their lives, as their annual salary may be up to half a million forints higher than today. In total, HUF 140 billion will remain with young people starting in 2022.
Varga also emphasized that employment taxes will decrease another 2 percentage points from July 1, 2022, with the 1.5 percent vocational training contribution being abolished and the social contribution tax reduced by 0.5 percentage points; this will enable companies to save HUF 250 billion per year.
This tax was still 28.5 percent in 2016 and has been reduced by almost one-half in five and a half years, as it will be 15 percent starting next summer.
The finance minister said that the tax cuts are intended to help even the smallest businesses, so the flat-rate taxation of sole proprietors will also become more favorable: They will not have to pay personal income tax until half of the annual minimum wage.
He also spoke about cutting the tax on virtual money in half, which could also whiten the cryptocurrency market.
We will ensure in the coming weeks that these tax cuts are secured through the adoption of next year’s budget and tax laws, Varga said.