The Newest Hungarian Tax Innovation – Taxing Flight Departures

Hungary is famous for introducing unorthodox taxes and trying new avenues of collecting tax revenue. As of 2024, the permanent establishment definition under the Local Business Tax Act has been extended to the ticket sales revenues of airlines departing from Hungarian airports, regardless of whether or not such airlines otherwise have a business presence in the country. This note explains the main features of the amendment and highlights certain theoretical and practical aspects.