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Brussels, 14 March 2011

Digital Agenda: Commission opens infringement procedure against Hungary over 'telecoms tax'

The European Commission today decided to send a request for information to Hungary over the new “special tax” imposed on the telecom sector to boost its tax revenues. Hungary introduced special charges for telecoms operators in October 2010. The Commission has concerns that this tax is incompatible with EU telecoms rules, which require specific charges on telecoms operators to be directly related to covering the costs of regulating the telecoms sector. Hungary has two months to reply to the request, which takes the form of a so-called 'letter of formal notice, the first stage of EU infringement procedures. The Commission has just decided to refer France and Spain to the EU Court of Justice concerning similar 'telecoms taxes' (see IP/11/309).

In October 2010, the Hungarian Government introduced a new “special tax” on three sectors of the economy: retail commerce, electronic communications and energy. The scope and rate of the tax is defined individually per industry and per revenue: for telecom operators, tax rates vary between 0% and 6.5%, on the basis of gross revenues (excluding VAT).

On the basis of information received from the Hungarian authorities, the Commission is concerned that the "special tax" on telecom operators is levied to cover costs other than administrative and regulatory costs related to the telecoms sector and is therefore incompatible with EU telecom rules. The “special tax” for 2010 was due last December, and operators already paid it. The “special tax” on the telecoms sector was expected to generate annual revenue of around €220 million.

The Hungarian Government has two months to reply to the request for information. If the Commission receives no reply, or if the observations presented by the Hungarian Government do not allay the Commission's concerns about the compliance of the "special tax" with EU telecoms rules, the Commission may issue a formal request for Hungary to ensure that it complies with EU l aw on the taxation of telecoms companies.

The application of the "special tax" to retail commerce and to energy companies is still being analysed by the Commission.


EU telecoms rules, in particular Article 12 of the Authorisation Directive (2002/20/CE), lay down precise provisions relating to the administrative charges that Member States can levy on operators authorised to provide telecoms services and networks. Charges on telecoms operators can only cover certain administrative and regulatory costs (mainly authorisations and regulatory functions) and should be objective, transparent and proportionate. Moreover, interested parties must also be consulted in an appropriate manner of regarding any amendments of the charges.

Digital Agenda website:

An overview of telecoms infringement proceedings is available at:

For more information on EU infringement procedures, see MEMO/11/162.

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