Hungary has moved ahead by one spot in the World Bank’s Doing Business 2020 rankings compared to the figures published last year, meaning it is now in 52nd place. Following the improvement achieved in this year’s World Economic Forum (WEF) rankings, the step forward in another ranking confirms the fact that the Hungarian economy is on the right track, and parallel to maintaining macroeconomic stability the qualitative and quantitative conditions for economic growth are also continuously improving.
The Doing Business survey ranks countries based on the quality of their business environment, and Hungary’s move up in the ranking is thanks to the government’s policy of reducing taxes and the significant reduction of administrative burdens.
Hungary’s Ease of Doing Business score increased to 73.4, moving it forward to 52nd place in the rankings. Based on the criteria examined by the World Bank, there are two government measures that have had a decisive effect on the improvement of Hungary’s score: the reduction of social contributions tax on 1 January 2018, and more rapid VAT rebates, in which the National Tax and Customs Administration has also played a major role in view of the fact that it is the tax office’s continuously expanding electronic services and online systems that are making it possible for those involved to receive their money faster without impairing the interests of the treasury.
The results of the Doing Business survey corroborate the fact that the administration’s measures aimed at improving the business environment, the reduction of tax burdens, and the simplification and enterprise-friendly modification of tax authority administrative processes, have had a positive effect on the competitiveness of Hungarian enterprises.
The government has continued to improve the tax environment this year, in view of the fact that the social contributions tax was further reduced from 1 January, and according to plan the tax administration burdens on enterprises could be significantly reduced from 2021 thanks to the fact that the National Tax and Customs Administration will be preparing draft tax returns for enterprises.
The Programme for a More Competitive Hungary adopted by the National Competitiveness Council includes a comprehensive plan for measures in several areas (e.g. taxation, business environment, job market), the realisation of which is contributing to a further improvement in competitiveness and a better operational environment for enterprises.
In the interests of further developing the business environment, from November of this year the National Competitiveness Council and the government will be further improving the competitiveness of the Hungarian economy and the productivity of enterprises via the implementation of the Economy Protection Action Plan and the Family Protection Action Plan.
(Ministry of Finance)
