Some activities still carry a permit but if an application is not ruled on within two months, the applicant will automatically be granted one. The law will take effect on January 1, 2016. Parliament also approved the taxpayer classification. A “good” taxpaying company that has operated for at least three years must not have had more than 500,000 forints (EUR 1,600) of tax arrears in the past five years.

For such companies, tax audits will last a maximum of 180 days after April 1, 2016, and the deadline for VAT reimbursements will be reduced from the current 75 days to 45 days from January 1, 2017 and to 30 days from 2018.

Taxpayers categorised “at risk” will be those who violate tax laws and amass a significant amount of debt in unpaid taxes. Individuals with above 10 million forints of outstanding tax will be classified as risky taxpayers, while this threshold will be 100 million forints for companies.

Taxpayers in this category will be subject to stricter tax laws, tax audits for them will be extended by 60 days and they will have to pay higher default charges.

The classification system will apply to some 525,000 taxpayers. Parliament also passed a law that will allow the tax office to prepare the tax returns of 1.5 million private taxpayers who only collect an income from their employer and are not entitled to a tax benefit.

From 2017, the tax office will prepare the tax returns of all private taxpayers. András Tállai, the economy ministry state secretary, said the system will make it easier for both individuals and companies to pay their taxes.

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