Hungary's Businesses Saw Profit Boost In 2002

by Ulrika Lomas, Tax-News.com, Brussels

08 September 2003

The total pre-tax profit of firms in Hungary in 2002 reached HUF 1.2 trillion ($7.06 billion) representing a 17.2% increase on the previous year according to preliminary figures released from the nation's tax authority APEH last week.

The figures are based on some 362,000 tax returns which have been processed so far out of a total of 374,000, up from a figure of 352,000 in the same period last year.

Not only do the statistics show a rise in revenues and profits in the Hungarian business sector, but the tax burden on firms also rose slightly too, from 13.47% in 2001 to 13.67% in 2002. The average tax burden on the individual meanwhile has eased having fallen to 22% last year, several percentage points lower than in 2001, says the tax authority.

In total, 4.5 million tax returns were submitted to APEH in 2002, and total personal income was HUF 4.8 trillion ($18.6 billion), over 15% higher than the previous year, according to the figures. The total collected from personal income tax equalled HUF 1.055 trillion.

The tax collectors also recorded some HUF 550 billion which fell outside the personal income tax categories, a significant proportion of which (HUF 225 billion) came from the sale of property in Hungary's booming housing market (prices grew 44% last year). Additionally, dividend income rose by 16.4% last year to HUF 135 billion, though gains in stock prices eased somewhat to total HUF 31 billion and some HUF 90 billion of tax was levied on these categories.

Other statistics recorded by APEH include a 5.3% increase in sales revenue from the nation's businesses, outstripping firm's expenditure which rose by 4.9%. Total revenue from exports was down slightly however by 1.1%.

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