Hungary on track to become an offshore paradise?

When talking about countries as centres of offshore speculations, it is probably not Hungary that comes to one’s mind first. However, the relevant tax modifications of the Orbán-administration seem to create a beneficial financial and economic environment for such schemes. That is the reason why Hungary received criticism for helping international companies avoid and minimalise their tax. Since Hungary does not have a bad reputation in that issue, more and more companies choose her to run their business on paper here.

According to telex.hu, Hungary was put on the map of “international tax planning” by the government’s tax modifications introduced in 2010. Experts say that the low corporate tax and the lack of several types of business taxes that companies must pay in other European states are enough to make Hungary a perfect target country for tax optimisation. Furthermore, if a company registered in the Seychelles-islands founds a subsidiary in Hungary and runs its operation through the latter,

offshore structures can get an onshore appearance.

Direkt 36, a partner of telex.hu, took part in the processing of the so-called Pandora documents. They found that Hungary established a reputation in the offshore sector in the last few years. The project was led by the International Consortium of Investigative Journalists, which got hold of the internal documents of 14 companies creating and running offshore subsidiaries.

In the papers, Hungary pops up multiple times as one of the offshore countries and is mentioned as an alternative to Cyprus or Malta.