Last updated on 26 March
The government of Hungary introduced new measures to relieve the economy of Hungary, protect work-places, and make sure it is easier for everyone to get through these difficult times and pick up work once the situation clears up. The new decree concerns the sectors most affected, a moratorium for debtors, and labor law.
Hospitality is an umbrella term in the service industry that includes lodging, tourism, entertainment, sports, event planning, film industry, and gambling. The measures intended to promote social distancing as the most important factor in hindering the spread of the virus, and indoor social gatherings of 100+ are forbidden, just like theater performances and cinema screenings. Restaurants and cafés close at 3 pm. These are all severe hits for everyone working in these sectors, but the measures are necessary to protect the health of the general population.
To relieve the burdens this poses on the industry, which concerns about than 500,000 people in Hungary, the following measures have been introduced as of 18 March, 2020:
While transportation is also a sector of the hospitality industry, here only self-employed small taxpayers (in the “KATA” construction) are mentioned, meaning mostly taxi drivers, who do not have to pay their contributions for March through June 2020.
*Small businesses not operating in the sectors listed here may also apply for a moratorium for paying some taxes and contributions or for payment in instalments with a valid reason. Consult your accountant about your options.
Since credit and staying creditable is an important element of the economy, the following measures have been introduced to help debtors not lose their collaterals due to late payment:
It is important to note that only agreements concluded before 18 March midnight are concerned: new contracts will have to be concluded as agreed between the banks and the debtors.
Another important financial measure is that the interest on unsecured loans (which means mostly personal loans) cannot be higher than 5% above the base rate of the central bank, currently 0.9%. This in itself might bring an end to easy small loans, where the annual percentage rate of charge (APRC) has until recently been above 13%, and a 5.9% limit may not be viable for banks.
The changes to labor law intend to facilitate accommodation to the current situation for both the employer and the employee. As of 18 March,
These changes remain in force until 30 days after the end of the current emergency.
If you are operating a business in Hungary, you should consult your accountant to check if any of these measures are relevant to you. See if your business operates in any of the sectors listed above, or if the effect of the safety measures recently introduced may be alleviated by the industrial reliefs or financial moratoria. Your payroll specialist will be able to tell you if paying salaries and payroll taxes is affected.
Click here to read about further economic relief measures in Hungary announced on 23 March.
Or click here for a full list (with TEÁOR codes) of sectors concerned.
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