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HATC SAMPLE EDITION:
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12th May, 2026
EU sues Hungary over retail tax
The European Commission is taking Hungary to the Court of Justice of the European Union over the windfall tax in the retail sector, arguing that the progressive turnover-based levy discriminates against foreign-owned companies, Portfolio reports.
The regulation breaches Articles 49 and 54 of the Treaty on the Functioning of the EU, which guarantee freedom of establishment, and is discriminatory as Hungarian retailers, operating in franchise structures, face lower effective tax rates.
The Orbán government refused to amend the regulations despite formal notices from the EC in October 2024 and June 2025.
Trade organisation Independent Retail Europe welcomed the Commission’s decision, saying the system distorts competition in the internal market and ultimately contributes to higher consumer prices.
During his parliamentary hearing, István Kapitány, the candidate for the Economy and Energy Ministry, said the government is reviewing profit caps and sectoral taxes.
The economy “works well if there is little intervention and market processes are allowed to run their course”, he remarked, but said “now is not the time to phase them out. The sectoral taxes will remain in their current forms,” he added.
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Sources regularly consulted, with abbreviations used in text: Népszabadság (N); Magyar Hírlap (MH); Világgazdaság (VG); Napi Gazdaság (NG); Magyar Nemzet (MN); Népszava (Nsz); Kossuth Rádió news (KR); nightly TV news (TV).
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