Hungary: Draft legislation to implement public country-by-country reporting
Legislation would require multinational groups to disclose certain tax-related information on a CbC basis
Draft legislation to implement public country-by-country reporting
Draft legislation (on 18 October 2022) was submitted to the Hungarian National Assembly to implement the EU public country-by-country (CbC) reporting directive.
In line with the EU rules, the draft legislation would require multinational groups to publicly disclose certain tax-related information on a CbC basis for financial years starting on or after 22 June 2024, when:
- The ultimate parent entity (UPE) is based in Hungary and the consolidated revenues of the multinational enterprise (MNE) group exceed HUF 275 billion (approximately €750 million based on the 21 December 2021 exchange rate) in each of the last two consecutive financial years.
- A qualifying subsidiary / branch of the MNE group is based in Hungary and the consolidated revenues of the MNE group exceed HUF 275 billion (approximately €750 million based on the 21 December 2021 exchange rate) in each of the last two consecutive financial years, if the UPE does not fall within the scope of the law of an EU member state.
Based on the draft text, Hungary would require MNEs in scope to explain the reasons behind any significant differences between the income tax accrued and income tax paid, if such significant differences exist. While the EU public CbC reporting directive allowed Member States to permit in-scope groups to defer the disclosure of commercially sensitive information, for up to five years, the draft Hungarian proposal doesn’t make use of this option.
Read a November 2022 report prepared by KPMG’s EU Tax Centre
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