Taxing wealth, shaping policy: Wealth tax bill submitted to the Hungarian Parliament

On 27 October 2026, the Government submitted the bill on wealth tax to the Hungarian Parliament (Bill No. T/930, the “Bill”). The Bill follows the public consultation on the draft published in early October (the “Draft”), which we summarised in our Client Alert of 8 October 2026. The basic structure of the tax is unchanged, but the Bill revises a significant number of technical rules, particularly on the valuation of shareholdings and real estate. Some changes ease the position of taxpayers, while others tighten it.

In this follow-up Client Alert, Associates Bence Kálmán and Bálint Apáthy highlight the most relevant changes.

What remains unchanged

The key parameters of the tax remain as set out in the Draft:

• the wealth tax would apply to the portion of net wealth exceeding HUF 1 billion, at a rate of 1% on the tax base up to HUF 100 billion and 1.5% on the portion above HUF 100 billion;
• resident individuals and resident asset management vehicles would remain subject to tax on their worldwide assets, while non-residents would be taxed only on Hungarian real estate and rights related thereto, shareholdings in Hungarian companies and interests in real-estate-rich companies;
• the residence exceptions (including those for Hungarian citizens living abroad for at least ten years and seconded employees during the first five years of employment) are retained;
• the basic valuation formula for non-listed shareholdings (one-third equity, two-thirds capitalised earnings at a 15% capitalisation rate), the 25% and 30% minority discounts and the HUF 500 million equity threshold for hidden reserves are retained; and
• the timeline is unchanged: entry into force on 15 December 2026, first tax point on 31 December 2026, first return and payment by 31 August 2027.

Key changes at a glance

1. Valuation of non-listed shareholdings

1.1 Simplified valuation for small companies

Where the equity of the company under its financial statements for the last completed financial year does not exceed HUF 100 million, the taxpayer may elect to value its shareholding at its proportionate share of equity instead of applying the valuation formula. This may result in a significantly lower value for low-equity, high-profit businesses. The threshold refers to the company’s equity, not to its market value or to the owner’s total wealth.

1.2 Fallback to acquisition cost

Where neither the statutory formula nor an independent valuation can be applied because the necessary information is unavailable for reasons not attributable to the taxpayer, the shareholding is to be valued at its acquisition cost. This would be a last-resort rule, not an elective alternative.

1.3 Negative equity is treated as zero

Under the Draft, only a negative earnings value was set to zero. Under the Bill, negative equity is also set to zero, so it is proposed to no longer offset a positive earnings value. For some companies this would lead to a higher taxable value.

Under the Draft, only a negative earnings value was set to zero. Under the Bill, negative equity is also set to zero, so it is proposed to no longer offset a positive earnings value. For some companies this would lead to a higher taxable value.

1.4 Aggregation of close relatives for the minority discount

When determining whether a holding is a minority holding, the holdings of close relatives within the meaning of the Civil Code would now have to be aggregated. For example, spouses each holding 30% would be treated as holding 60% and would lose the discount altogether. Two siblings holding 20% each would be treated as holding 40% and would be entitled to a 25% rather than a 30% discount. In practice, spreading family shareholdings among family members or a partial generational transfer would no longer reduce the taxable value in itself. This rule would not combine spouses’ overall tax bases or their HUF 1 billion thresholds.

1.5 Revised definition of holding companies

Under the proposed changes, a holding company would now be expected to have the holding of shareholdings and the subsequent exercise of control as its primary purpose rather than the direct production of goods or provision of services. At the same time, the 90% asset test is broadened: in addition to shareholdings, the Bill now includes securities, other financial investments, cash, own-use real estate and receivables from subsidiaries as assets counting towards the threshold. Holding companies would continue to be valued on an equity-only basis.

1.6 Hidden reserves

No auditor review would be required in case the market value of the relevant real estate, shareholdings and securities is determined using their calculated value under the Bill. The Bill would also make the reporting obligation of Hungarian companies with equity above HUF 500 million conditional on a request from at least one shareholder.

1.7 Demergers and consolidated accounts

Following a demerger, the historical earnings of the continuing company would have to be reduced by the earnings attributable to the demerged company. In case of consolidated accounts, equity and earnings attributable to non-controlling interests would have to be deducted.

2. Listed shares

Listed shares and shares regularly traded outside a regulated market would still be valued at the closing price on the last trading day of the year. However, if the closing price deviates by more than 10% from the volume-weighted average, the reference period is now proposed as the last 180 days of the year instead of 30 days. This should reduce the effect of short-term year-end price movements.

The transitional option for 2026, which would have allowed taxpayers to use average prices for the 2026 tax year, has been removed for shares. In the Bill, it remains available only for certain debt securities.

3. Hungarian real estate

3.1 Broader scope of the HTA mass valuation model

The model operated by the HTA would cover not only flats and agricultural land without buildings, but also holiday homes and building plots, for which the Bill introduces new definitions. Whether a model value will in fact be available for every such property, remains to be seen.

3.2 Stronger protection when using the HTA model

The HTA may only determine a different value and a resulting tax shortfall, if it proves that the taxpayer did not enter the actual parameters of the property into the model. Under the proposed changes, taxpayers using the model with accurate data would therefore bear limited valuation risk.

4. Non-residents: real estate rich companies

For non-resident individuals and asset management vehicles holding interests in foreign-registered companies qualifying as real-estate-rich companies for real estate transfer tax purposes, the Draft took into account the proportionate share of the calculated value of the company’s Hungarian real estate without addressing related debts. Under the Bill, the calculated value of the Hungarian real estate owned by the company would have to first be reduced by debts directly related to its acquisition, construction, maintenance or value-enhancing improvement and only the resulting amount would be apportioned according to the taxpayer’s ownership ratio.

5. Treaty relief for foreign assets

It is proposed if a tax treaty allowed Hungary to take foreign assets into account when computing the tax on other assets (exemption with progression), the amount of tax to be deducted would be calculated after deducting the related debts and applying the HUF 1 billion threshold to the foreign assets. Depending on the fact pattern, this may increase the Hungarian tax compared with the wording of the Draft. For example, with HUF 3 billion of Hungarian assets and HUF 2 billion of treaty-exempt foreign assets, the computed tax on total wealth would be HUF 40 million, from which only HUF 10 million could be deducted, leaving HUF 30 million payable in Hungary. It is worth noting that the explanatory memorandum to the Draft already used the same example with the same result, so the change may largely codify the intended approach.

What does this mean for the affected taxpayers?

The Bill is now subject to parliamentary debate and may still be amended. Nevertheless, the direction of travel is clear and the first tax point on 31 December 2026 is approaching. We recommend that affected taxpayers:

• reassess the valuation of family business holdings considering the aggregation rule for close relatives, the treatment of negative equity and the new holding company definition;
• check whether smaller companies qualify for the simplified equity-based valuation;
• review the financing of real-estate-rich structures held by non-residents; and
• model the effect of the revised treaty relief calculation where significant foreign assets are held.

The Wolf Theiss Tax Team stands ready to assist in assessing the impact of the Bill on your wealth and existing structures.