Hungary upstream fiscal summary Report

Country Report 30 October 2023

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Report summary

Hungary’s concession-based fiscal regime is relatively simple. The main elements include a royalty (extra profit tax), corporate income tax, and an additional profits tax (Energy Suppliers tax). Royalty is a biddable term but the government has set a minimum rate. The extra profit tax is levied via increased royalty rates for 2022 and 2023. Standard royalty rates apply from 2024. The energy suppliers tax has the same tax base as corporate income tax resulting in a marginal tax rate of 40%. Both are ring-fenced at the country level. There are also local business and indirect taxes. There is no state participation.

Basis
Licence terms
- Duration
- Relinquishment
Government equity participation
Fiscal terms
- Bonuses, rentals and fees
- Indirect taxes
- Royalty
- Ring fencing
- Base
- Rate
- Payment schedule
- Additional petroleum taxes
- Base
- Rate
- Payment schedule
- Base
- Rate
- Payment schedule
- Corporate income tax
- Ring fencing
- Base
- Rate
- Payment schedule
- Energy suppliers tax (the ‘Robin Hood’ tax)
- Base
- Rate
- Payment schedule
- Windfall tax (2022-24)
- Ring fencing
- Base
- Rate
- Payment schedule
- Fiscal treatment of decommissioning
- Product pricing
- Summary of modelled terms
Recent history of fiscal changes
Stability provisions
Split of the barrel and share of profit
Effective royalty rate and maximum government share
Progressivity
Fiscal deterrence