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In addition to the fact that 94 percent of budget revenue is provided by the tax office and they help with the administration of tax affairs with a number of services, the number of their tasks is also growing significantly year after year, they write. Since January 1 this year, NAV has practically become Hungary’s universal executive body. Administrative cases were transferred in 2018, and this year all court cases will be handled by NAV. This represents around 300,000 new cases in 2020 compared to previous ones. On July 1 of this year, the tax office took over another task: sole proprietorship registration. Currently, more than 562 thousand sole proprietors are included in the database of the tax office.
NAV’s repertoire of tasks will be further expanded next year. In addition to handling tax matters related to motor vehicle tax, the local business tax return must also be submitted to the tax office, the latter providing tax administration facility for approximately 800,000 businesses as of 2021. With registration From the so-called beneficial ownership database, NAV employees will play an even bigger role in the fight against money laundering next year.
Another IT tax bureau service will debut next year, which, as before, will also encourage companies to adopt digital solutions more broadly, thereby improving the country’s competitiveness. This new service is a recommendation from the tax office of draft VAT returns, which more than half a million VAT return companies are expected to expect from the second half of 2021.
The tax office’s online tools and risk-based auditing practice have also proven their value in fighting the shadow economy. VAT loss due to tax evasion fell from 21 to 7 percent last year, outpacing Germany, Austria and Denmark, according to the report. The Ministry of Finance aspires to continue improving, so next year it will create a Committee for Sustainable Economic Whitening.
At the same time, NAV is recruiting fewer and fewer staff, both existing and new. While at the end of 2015, more than 21,000 people worked for the office, there are currently about 18,000.
With the new NAV law introduced today, the integration of the organization will be completed. The bill, if voted by Parliament, creates a unified legal relationship; the so-called tax and customs service, which does not distinguish between civilian and professional personnel in terms of their legal status and applies to government officials as well as financial guards and case managers.
Cover image: Getty Images
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