Hungary levies excess-profit tax on construction material producers

Hungary's government has levied a 90 per cent excess-profit tax on some producers of construction materials from 9 July, in an effort aimed at curbing surging prices.

The tax applies to companies that produce cement and other materials, including plaster, chalk, gravel, sand, clay, lime and gypsum, with annual revenue of HUF3bn (US$10.02m) or more in 2019. It requires the companies to pay a 90 per cent "mining allowance" on the difference between revenue generated using their own prices and threshold prices set in the decree.

The threshold prices have been set at HUF700/t for sand, HUF900/t for gravel, HUF700/t for sandy gravel and HUF20,000/t for cement.

The government also announced that it is seeking the approval of Brussels to impose export restrictions on certain products from October to ensure that domestic consumers have access to sufficient quantities of raw materials.