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Foreign online shops will be required to appoint a tax representative in Hungary – brand new green tax rules to be considered
From July 2023, the Hungarian waste management regulations, and environmental product charge (the “green tax”) rules will change significantly.
Among other changes, with effect on 1 July 2023, foreign online shops selling goods to Hungary within the framework of an e-commerce service will become liable to the extended producer responsibility (the “EPR”) fee and green tax payments in Hungary, even if they submit their VAT returns via the OSS system in their own country.
Affected taxpayers:
The online shops established outside Hungary and selling certain goods to end-users (B2C sales) with the addressee located in Hungary should be affected.
Such goods may be sold either on their own or as accessories or components of other products. Packaging materials as part of the product packaging may also be liable to public charges.
Hungarian tax representative:
Even the online shops performing their VAT obligations via the one-stop shop system (the “OSS”) are obliged to appoint a Hungarian tax agent and representative before 30 April 2023 to fulfil their EPR and green tax obligations, registration with the tax authority and the waste management authority, return filing, data reporting, and record-keeping in Hungary from 1 July 2023.
Goods in scope:
Goods liable to the EPR fee overlap significantly with goods subject to green tax, however, there are some significant differences. The green tax may be deductible from the EPR fee.
By virtue of packaging and packaging materials, practically any online shop selling goods to end-users in the territory of Hungary may be liable to public charges even if the sold goods are out of the scope of the EPR fee and green tax.
Sanctions for non-compliance:
Both tax law sanctions and waste management penalties may be imposed for non-compliance with the latter being significantly higher.
For more information, please contact:
VGD Hungary Kft.
T: +36 (1) 225 7575
E: vgd.budapest@vgd.hu
www.vgd.hu
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