Tax administrative costs for a representative Hungarian company are far above the European average

15/05/2020

Reducing tax administrative costs in the context of VAT, CIT and employment-related taxes would save a considerable amount of resources for Hungarian businesses – the findings of the study prepared by the Budapest Insitute suggest. The BI has run the project in partnership with Ernst & Young Hungary with the aim of supporting the Ministry of Finance in its effort to simplify the business taxation system in Hungary.

Based on the Standard Cost Model (SCM) we identified the tax administrative burdens by conducting a representative, business survey. Ont he one hand, in line with the SCM methodology we collected firm-level data on the time and costs spent for tax administration across company types and sectors. On the other hand, we assessed business perceptions and expectations on relevant tax policy reform steps.      

Petra Edina Reszkető, BI’s senior researcher, presented and discussed the methodological challenges and the policy recommendations with government stakeholders in a workshop co-organised by the Ministry of Finance and the  National Tax and Customs Administration.

For more information on this policy research project, see here.