This spring, changes will come into force in the support system for investments in Hungary, as the related government decree (210/2014 (VIII. 27.)) will soon be amended. The aim of the amendment is to modernise the support conditions for investments based on individual government decisions in line with the current economic environment and the expectations of the new investment encouraging strategy.
The Hungarian Ministry of Foreign Affairs and Trade has launched a public consultation on the expected amendments and invited feedback until 21 March 2025.
Investments from EUR 2 million can be supported
The amendment of the government decree will allow investments from EUR 2 million to be eligible for support in some parts of Hungary. The regions concerned are Borsod-Abaúj-Zemplén, Heves, Nógrád, Szabolcs-Szatmár-Bereg, Bács-Kiskun, Békés, Csongrád-Csanád, Baranya, Somogy, Tolna and Zala counties.
The minimum eligible cost of the investment will remain tiered depending on the location of the investment. The additional bands are as follows:
- EUR 3 million: in municipalities of the counties of Hajdú-Bihar, Jász-Nagykun-Szolnok, Pest, Fejér, Komárom-Esztergom, Veszprém, Győr-Moson-Sopron and Vas not qualifying as district seat municipalities.
- EUR 5 million: in Salgótarján, Miskolc, Nyíregyháza, Békéscsaba, Pécs, Kaposvár, Szolnok, or in municipalities of the counties of Hajdú-Bihar, Jász-Nagykun-Szolnok, Pest, Fejér, Komárom-Esztergom, Veszprém, Győr-Moson-Sopron and Vas that are considered as district seats.
- EUR 10 million: in the municipalities of Győr, Székesfehérvár, Tatabánya, Szekszárd, Kecskemét, Szombathely, Veszprém, Zalaegerszeg, Debrecen, Szeged and Eger.
Changes in terms of commitments
There are also significant changes to the commitments for subsidy for investments. The two main elements of the commitments will be wage bill (EUR 5 million increase in wage bill over the maintenance period) and turnover (EUR 25 million increase in turnover over the maintenance period) instead of staff maintenance.
However, in addition to these, the following commitments are expected to be required:
- a wage increase per capita or
- a per capita increase in turnover, or
- creation of at least 25 new jobs.
In addition to the above, at least two of the following commitments will be required:
- creation of R&D jobs,
- R&D expenditure increase,
- achieve the required proportion of suppliers within 100 km to reduce environmental impact,
- use of own renewable energy, also to reduce environmental impact,
- increase the number of employees in dual training or student employment contracts, possibly with a vocational training contract.
It is clear from the expected changes that support for investments will be more focused on innovation and environmental protection than before, and that the emphasis will be on average wage growth rather than employment growth, thus supporting higher value added production as opposed to lower value added mass production.
The experienced financial management experts of WTS Klient Hungary are happy to provide our clients with up-to-date information on investment support options, legal requirements and financial accounting for subsidies. Contact us if you need an expert!
This article provides general information and does not constitute advice.
