Significant Legal Changes as of January 1, 2019

On January 1, 2019 the amendments of several statutes entered into force.


Commission Delegated Regulation (EU) 2016/161 laying down detailed rules for the safety features appearing on the packaging of medicinal products for human use shall be mandatorily applied as of February 9, 2019. The purpose of the regulation is to prevent falsified medicinal products from entering into the legal supply chain by requiring the placing of safety features consisting of a unique identifier and an anti-tampering device on the packaging of certain medicinal products for human use for the purposes of allowing their identification and authentication. In accordance with Article 54(a) (1) of Directive 2001/83/EC, medicinal products subject to prescription are to bear the safety features while medicinal products not subject to prescription are not allowed to.

The unique identifier is a safety feature enabling the identification of individual packs of medicinal products and the verification of its origin, evidencing that the medicinal product was produced by a legitimate manufacturer. An anti-tampering device is a safety feature with which one can control if the packaging of the medicinal product has been manipulated or it is intact.

In compliance with the aforesaid, Section 32(5)z) of Act XCV of 2005 on Medicinal Products for Human Use and on the Amendment of Other Regulations Related to Medicinal Products (the Drug Economy Act) authorizes the minister in charge of the healthcare system to specify in a decree the detailed rules concerning the safety features to be placed on the external packaging of medicinal products and their handling. This ministerial decree on the detailed rules has not been promulgated yet.

The regulation regarding homeopathic medicinal products has also been amended. Pursuant to Section 29 of the Drug Economy Act, homeopathic medicinal products that have therapeutic indications and were authorized before May 1, 2004, can be marketed after January 1, 2020, only if they comply with the provisions regarding the marketing of such medicinal products included in Directive 2001/83/EC and the national statutes transposing it. Therefore, the requirements concerning the marketing of homeopathic medicinal products do not change; the legislator only extended the already applicable system to homeopathic medicinal products authorized before May 1, 2004. From January 1, 2020 and thereafter, all homeopathic medicinal products – irrespective of the date of their authorization – must comply with the applicable EU requirements and the national transposing statutes.

Section 185/A of Act C of 2012 on the Criminal Code (Criminal Code) introduced a new criminal offense of adulteration of medicines and preparation of counterfeit medicinal products. The reason for the amendment is that Directive 2017/2103/EU considers all substances covered by the Convention on Psychotropic Substances of the United Nation, 1971 as narcotics but the Criminal Code included only the dangerous psychotropic substances which are defined as such in Lists I and II of the Annex. In order to harmonize the different definitions and fully comply with Directive 2017/2103/EU as well as provide internal coherence, all pharmaceutical products were removed from the conceptual framework of health care products and all criminal acts related to pharmaceutical products were included in the Criminal Code as of January 1, 2019.


Both the minimum wage and the minimum guaranteed salary amounts increased as of January 1, 2019. Pursuant to Government Decree No. 324/2018 (XII. 30.), the amount of minimum wage for full time employment shall be HUF 149,000 and the amount of minimum guaranteed salaries HUF 195,000 per month.

Act I of 2012 on the Labor Code (“Labor Code”) was amended again as of January 1. Section 94(3) of the Labor Code states that the maximum duration of working time banking fixed in the collective agreement is 36 months if justified by objective or technical reasons or reasons related to work organization. Two hundred and fifty hours of overtime work can still be ordered in a given calendar year but Section 109(2) of the Labor Code allows the ordering of maximum further 150 hours of overtime work in a given calendar year on the basis of a written agreement between the employer and the employee. The latter is called voluntary overtime by the act.

Cafeteria rules have changed significantly. As of January 1, 2019, the employer may provide support exclusively through Széchenyi recreation card (SZÉP) with favorable rules regarding the payment of public fees and charges related to benefits in kind – i.e., where the total proportion of payable public fees and charges does not exceed 34.5% – in three categories: maximum HUF 225,000.- per year for accommodation, maximum HUF 150,000.- per year for catering and maximum HUF 75,000.- per year for recreation, with the proviso that the total annual amount of benefits in kind may not exceed HUF 450,000.-. This annual limit of HUF 450,000 has not changed since last year.

The result of the above amendment is that from January 1 on, employers may no longer give their employees cash in the maximum amount of HUF 100,000 as a benefit in kind with reduced payment of public fees and charges.


On January 1, 2019 significant changes entered into force in the field of the employment of pensioners. The rate of personal income tax levied on the salary of an old-age pensioner employee is only 15% and employers are no longer required to pay 4% health insurance contribution and 10% pension contribution. It is also beneficial for employers to employ an old-age pensioner, since from January 1, 2019, employers do not have to pay 19.5% social contribution tax levied on the salary of old-age pensioner employees and 1.5% vocational training levy, either.


Section 2/A of Act LXXXI of 1996 on Corporate Tax and Dividend Tax introduced the institution of corporate taxpayer group, which already existed in the system of value added tax. It can be created by resident affiliate companies having at least 75% majority control between them. The enterprises choosing it will be excluded from having to produce the so-called transfer price documentation.

Pursuant to Section 188(2) of Act CXXVII of 2007 on Value Added Tax, the limit of personal exemption for SMEs increased from HUF 8 million to HUF 12 million. It is a notable transitional rule that a company may claim personal exemption for the year 2019 even if its 2018 sales revenues exceed HUF 8 million but are less than 12 million.

One of the more significant changes affected the social contribution tax (SZOCHO). Health contribution and social contribution taxes have been merged. In order to make it clear, a new act (Act LII of 2018 on Social Contribution Tax) taking effect as of January 1, 2019, has been adopted. The rate of social contribution tax is 19.5% of the tax base. From July 2019, the rate of the tax decreases by 2 percentage points, therefore, the social contribution tax will be 17.5% afterwards.

From January 1, 2019, the taxation of the income from leasing real properties became more favorable. On the basis of Section 17(3a) of Act CXVII of 1995 on Personal Income Tax, in respect of the rental of real estate property, the fee charged by the lessor to the lessee for services provided by other persons in relation to the use of the property, purchased from such person (in particular public utility services) in proportion of use, shall not be treated as revenue. That amount does not constitute real income in the case of an individual, as they have to be paid to the given service provider.

According to the provisions of Act CXLVII of 2012 on the fixed-rate tax of low tax-bracket enterprises and on small business tax (KATA/KIVA), the upper limit of income to become a small business taxpayer increased from HUF 500 million to HUF 1 billion. In compliance with it, the limit of the exceeding of the income cap that result in the termination of small business taxpayer status increased up to 3 billion forints.

From January 1, business organizations may manage their taxation matters exclusively electronically through the corporate portal of the National Tax and Customs Administration of Hungary. In addition to electronic communication, the corporate portal may also be used to submit tax returns and download official documents.

The content of this newsletter is for information purposes only and should not be treated as legal advice by KNP LAW Nagy Koppany Varga and Partners or any of their attorneys. For more information please contact us.