The Hungarian Parliament will vote on the next year’s tax package at the end of June. As part of the proposal, the rate of the personal income tax shall decrease from 16% to 15%. Currently the dividend and interest withholding tax form an integral part of the personal income tax regime in Hungary, thus these two withholding tax rates are also expected to diminish.
In Hungary at present only private individuals are subject to withholding tax. The change in tax rate has no impact on legal entities as they are subject to 0% withholding tax rates currently.
Impact on investors: Private individual investors’ dividend and interest withholding tax obligation is expected to lessen from the present 16% rate to 15% from 1 January 2016.