Outside the EU - Hungary
Foreign trade by Hungarian companies is regulated by Government Decree. Hungary is also a signatory to many bilateral and multilateral international agreements on foreign trade. As of 1 May 2004, Hungary has applied the Community tariff articles in respect of third countries outside the European Union.
For products that are sold and shipped outside the Community, exemption from value added tax requires that the product leaves Community territory in a way that can be verified by the Customs authority within 90 days of the sale. The VAT Act also provides for the tax rebate form that must be issued to a foreign traveller in order to prove tax exemption.
The task of the Hungarian Export Credit Insurance Company is to stimulate and promote external trade links; the distribution of the financial risks of export cannot be ensured by means of traditional market instruments. Insurers - irrespective of their methods - offer protection against commercial and political risks for export companies and their banks.
From the perspective of paying value-added tax, the importing or other means of bringing a product not in free circulation from the territory of a third country to the territory of the Community is classed as product import. As a general rule, the place on the territory of the Member State to which the imported product was brought must be regarded as the place of execution.
You can find information on customs tariffs and goods classifications applied in Hungary on the website of the Customs and Finance Guard.
The Customs authority shall act in excise cases. The Excise Act contains regulations relating to the imposition, filing, authorising of and exemption from excise duties.
Environmental protection product tariff
In the case of imports, the person liable for Customs duties under the Customs laws, or the operator of a duty-free area, must pay the environmental protection product tariff.
Exporting and importing services
The VAT Act records the concept of providing a service, as well as taxation questions relating to the provision of services outside the territory of the Community or from premises outside the Community, including the conditions for tax exemption.
The obligation to provide data relating to external trade of products outside the European Union is recorded in a Government Decree.
Since 30 June 2009, reports may only be submitted electronically, using the Export Control System (ECS).
Simplified export procedure
During the simplified electronic export procedure, the exporter starts the export procedure in the form of an electronic message. The Customs export office sends electronic confirmation to the exporter, who shows it with the shipment when it leaves the country. The other procedures make it possible for the Customs export office to have information relating not only to the export procedure but also to the fact of export (place, date).
To export certain goods from Hungary, you are required to hold a licence issued by the Hungarian Trade Licensing Office. These goods include, for example, explosives and pyrotechnic products.
In Hungary, the possibility of preparing and making electronic goods declarations is guaranteed for Customs import procedures. After the imported goods are handed over to Customs, some customers who are registered for electronic goods declarations (e.g. those who have an AEO certificate) will have the opportunity for this 24 hours a day, while others will have the opportunity during the official opening hours of the Customs and Finance Guard Office.
In order to protect the territory of the Community and the citizens of the Member States, a risk assessment must be carried out in respect of all goods arriving on the territory of the Community, for security and defence purposes, before the goods arrive on the territory of the Community, and on the basis of the goods declaration collected upon entry and submitted electronically.
Value-added tax on imported products is determined by the Customs authority if the taxpayer does not have a licence from the Customs authority entitling him to self-assessment in respect of product imports. Taxpayers who do have a licence fulfil the tax obligations for their imports of products by means of self-assessment.
Exporting and importing services
As a general rule, the place of execution for providing data is the place where the registered office or permanent premises of the company availing itself of the service is located, failing which it is the place where he lives or has his usual place of residence. In the event that a service is provided, the obligation to pay tax arises at the time of sale, unless otherwise provided for. The price for performance is the tax basis.
In terms of cross-border services, the Hungarian Trade Licensing Office can issue a licence for company exports.
Statistics on trade with countries outside the European Union are based on the records (Extrastat) prepared by the Customs and Finance Guard as part of its Customs procedures. However, as of 2009, statistical data is collected directly.
Hungarian organisations that offer services to foreigners or take advantage of services from foreigners are obliged to provide data on external trade of services. Company data is collected quarterly and annually. In order to facilitate the provision of data on external trade of services, the Central Statistical Office operates a user-friendly electronic data collection system.
The Ministry of Foreign Affairs provides information on bilateral agreements between Hungary and other countries to eliminate trade barriers, commitments undertaken in international agreements, and agreements with third countries on introducing professional programmes.
A lot of useful information can also be found on the Hungarian Trade Licensing Office website.
Check also the legislation on this topic in: