What is the Global Minimum Tax?
The Global Minimum Tax, led by the OECD, seeks to establish a minimum corporate tax rate of 15% for multinationals with revenues in excess of 750 million euros. The aim of this scheme is to prevent the erosion of the tax base and to ensure fairer tax competition at the international level.
Hungary’s position vis-à-vis OECD rules
Hungary, known for its tax competitiveness with one of the lowest corporate tax rates in Europe, faces challenges in implementing the Global Minimum Tax. While the country is committed to aligning itself with international OECD regulations, it also seeks to maintain a competitive business climate for foreign investment.
Potential impacts on companies and the country
- Supplementary tax liabilities: Multinationals operating in Hungary could face adjustments (supplementary taxes) if their effective tax rate is below 15%.
- Increased tax oversight: Increased documentation and reporting requirements for multinational companies are expected.
- Fiscal responsibility and economic growth: By complying with OECD standards, Hungary’s efforts to strike a balance between fiscal responsibility and economic growth are highlighted.
Recommendations for companies
- Reassess tax strategies: It is crucial to analyze how the new rules will impact operations in Hungary.
- Strengthen documentary preparation: Make sure you comply with the transparency and reporting requirements of the OECD.
- Seek professional support: Having international tax specialists can make it easier to adapt to regulatory changes.
How can TPC Group help you?
At TPC Group we understand the challenges multinational companies face with the Global Minimum Tax. Our team of experts in transfer pricing and tax compliance can help you adapt your strategies to ensure compliance and optimize your operations.
Contact us for more information!
Source: Hungarian Conservative
