Global Daily Tax News, Hungary To Further Extend Financial Sector Windfall Taxes, (May 29, 2025)

The Hungarian Government has tabled legislation to extend the nation's windfall taxes on banking and insurance services providers.

Bill T/11920, On certain tax obligations and amendments to certain tax laws, would extend the windfall profits tax into 2026.

Late last year, the Government published Government Decree 356/2024 in the Official Gazette providing that the tax would apply during 2025.

The new legislation confirms that, for 2025, the rate of tax on credit institutions and financial institutions will be seven percent on taxable amounts up to HUF20bn, while an 18 percent rate will apply on the excess.

For 2026, the rate will be eight percent on taxable amounts up to HUF20bn, while an 20 percent rate will apply on the excess.

The legislation sets out how taxpayers can reduce their liability to the levy by purchasing government bonds.

It confirms that taxpayers must declare their liability to the levy for 2025 on a separate form by June 10, 2025, and settle the tax liability in two instalments, by June 10, 2025, and December 10, 2025.

The Bill also features provisions for the introduction of personal income tax exemptions for mothers with two or more children.