| Author (Corporate) | Council of the European Union |
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| Series Title | Official Journal of the European Union |
| Series Details | L 252, 8.10.2018 |
| Publication Date | 08/10/2018 |
| Content Type | Legislation |
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Summary: On 20 August 2018 the European Commission presented a proposal for a Council Implementing Decision authorising Hungary to introduce a measure derogating from Articles 26(1)(a), 168 and 168a of the VAT Directive. The Council of the European Union adopted the Decision on 2 October 2018. Further information: Taxable persons in Hungary may currently deduct VAT on the leasing of passenger cars to the extent that the passenger car is used for the taxable person's taxable economic activity. Taxable persons must thus be able to prove the extent to which they use their passenger cars for business purposes. Hungary submits that this system is difficult to apply. Keeping journey logs imposes a heavy burden on taxable persons in maintaining such logs and on the tax administration for checking them. It is often difficult to determine and document private and professional use if the employee keeps the vehicle after work and on days off. Inspections have shown that often journey logs kept by taxable persons are incorrect and difficult to verify. Hungary therefore requested on 6 February 2018 to introduce a measure derogating from Articles 26(1)(a), 168 and 168a of Directive 2006/112/EC (the VAT Directive) limiting the right of deduction on the leasing of passenger cars to a set percentage. In turn businesses will be relieved from accounting for tax on private use. This has the benefit of simplifying the system for all concerned and prevents tax evasion or avoidance because of incorrect record keeping. |
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| Source Link | https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=uriserv:OJ.L_.2018.252.01.0044.01.ENG |
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| Subject Categories | Taxation |
| Countries / Regions | Hungary |
