Advertising tax returns, exemption ends in the summer of 2026

In recent years, the focus of the Hungarian tax system has shifted increasingly towards turnover and consumption taxes. Several sector-specific taxes have been introduced, targeting particular segments of the economy. One of such regulations was the Advertising Tax Act, which established a new, turnover-based tax on the publication of advertisements and the provision of advertising services. Originally, the law applied a progressive tax rate based on the taxpayer’s annual net revenue. In 2015, the tax rate was set at 5.3% on the portion of the tax base exceeding HUF 100 million. Subsequently, as of 1 July 2017, the general tax rate was established at 7.5%, while annual net revenues up to HUF 100 million remained exempt from taxation.

As a result of changes in recent years, the tax system underwent a significant change in July 2019, when a full tax exemption was introduced for all taxpayers falling under the scope of the above-mentioned Act for the period between 1 July 2019 and 31 December 2022. This exemption was subsequently extended year after year, and under the currently effective legislation, it is set to remain in force until 31 December 2025. In early October 2025, in line with previous practice, a bill was published to further extend the exemption until 31 December 2026. However, the draft amendment released in mid-October unexpectedly shortened this period, proposing that the exemption be extended only until 30 June 2026. Given the mid-year amendment, a transitional rule is deemed necessary for the broken tax year of 2026. Accordingly, the Parliamentary Committee on Economic Affairs proposed that for the tax year including 1 July 2026, taxpayers would be required to pay half of the calculated tax, meaning that no advertising tax obligation would apply to revenues generated in the first half of the year.

If the legislative proposal published in mid-October enters into force, the tax rate for taxpayers will be 7.5% from 30 June 2026, while the portion of annual net revenue from taxable activities not exceeding HUF 100 million will remain exempt from the tax. The Hungarian Advertising Association has already indicated that the reintroduction and continuation of the advertising tax would be counterproductive.