The Hungarian parliament has approved a bill that reduces the payroll tax from 27 percent to 22 percent in 2017, and to 20 percent from 2018.
According to MTI, the law was passed with 146 in favor, 7 against and 27 abstentions
The bill adjusts the healthcare contributions accordingly, reducing them from 27 percent to 22 percent for 2017.
Mihály Varga, minister for National Economy, submitted the bill to parliament earlier in December. The planned payroll tax cut was announced in November after the government reached an agreement with employers and unions on a significant minimum wage increase.
The bill also establishes a 9 percent flat-rate corporate tax from January 1.
The corporate tax rate is currently 10 percent on a tax base up to 500 million HUF and 19 percent above that.