Establishing the scope of big volume taxpayers and taxpayers having the highest tax performance

The decree of the Ministry for National Economy on the establishment of the scope of big volume taxpayers and taxpayers having the highest tax performance was promulgated on 14 February 2012. In this newsletter we would like to inform you briefly about the new regulation coming into force on 15 February.

Big volume taxpayers, taxpayers having the highest tax performance

Big volume taxpayer is

• a credit institution and insurance company operating as a public limited company, or
• a taxpayer whose tax performance reached HUF 3,250,000,000 (excluding publicly financed institutions, individual entrepreneurs and private people)

that is not subject to bankruptcy, liquidation or final settlement proceedings on the last day of the year preceding the tax year.

A taxpayer is considered a taxpayer having the highest tax performance if the value of tax performance reached

HUF 690 000 000.

In order to evaluate the current status of the national economy the tax authority may request the 10 000 taxpayers having the highest tax performance to supply data – in connection with their tax liabilities – as a matter of urgency. With regard to this rule any taxpayer whose tax performance reached HUF 140 000 000 and who was obliged to submit a VAT return on a monthly basis on 1 September of the year preceding the tax year is considered as a taxpayer having the highest tax performance.

Tax performance calculation methodology

The value of the tax performance shall be calculated as the total of the arithmetic mean of the below listed tax performance items projected for one year (determined proportionately by taking into account the commencement of the activity). During the calculation only the data to be found on the tax returns submitted to the National Tax and Customs Administration and the data to be found in the registers thereof may be taken into consideration.

Tax performance items:

a) tax to be paid on the sales indicated in the VAT returns submitted for the period between 1 January of the sixth year preceding the tax year and 30 June of the year preceding the tax year (as from 1 May 2004, tax to be paid less the tax to be paid under the title of product purchase and product import from within the Community) and from the tax values that can be deducted in connection with the purchase the higher value to be found in the tax returns;

b) the corporate tax (calculated tax) not reduced with the tax advantage in the corporate tax return and the capital return tax regarding the period between 1 January of the sixth year preceding the tax year and 31 December of the second year preceding the tax year; in case of tax payers selecting a financial year which is not the same as the calendar year the data of the tax return submitted until 31 August of the year preceding the tax year must also be taken into consideration;

c) with regard to the period between 1 January of the sixth year preceding the tax year and 30 June of the year preceding the tax year the

• liability for the payment of contributions (excluding publicly financed institutions),
• liability for the payment of excise tax, environmental product fee, registration tax, energy tax;

d) with regard to the period between 1 January of the sixth year preceding the tax year and 31 December of the second year preceding the tax year

• the calculated tax in the income tax return, the tax of income to be taxed separately and the entrepreneurial tax advantage,
• the liability for payment of employers and payers established in the income tax return thereof excluding publicly financed institutions,
• tax liability established in any other tax return (not including employer, employee, and healthcare contribution at publicly financed institutions), and
• the claimed budget aid calculated at absolute value, excluding tax reclaim and tax refund.

The tax performance is calculated on the basis of data kept on file on 1 September of the year preceding the tax year.

The Newsletter contains general information. Therefore, the content of the Newsletter may not be regarded as professional advice or comprehensive information for decision-making. This information – due to its nature – may not address all details, especially all circumstances of a certain transaction. Although we used every effort for our Newsletter to be comprehensive, we cannot assume liability for the outlining and interpretation of the relevant regulations.