The Hungarian Act on the Employee Stock Ownership Plan (the
"ESOP Act") was amended by the Hungarian Parliament in
November 2019. It is good news that the amendment does not affect
the taxation of incomes from the ESOP organization, so it is still
possible to get a private income through an ESOP under very
favorable tax conditions. Accordingly, payments made to the
employees within the ESOP are solely subject to a 15% personal
income tax, which means 18.5% savings for the employees, while on
the other hand employers can reduce their public burdens with
21%.
The amended ESOP Act however significantly influences the
conditions for the establishment and the operation of the ESOP
organization, and in some cases, they are explicitly restricted.
For example, the ESOP shall be solely based on securities
representing shareholder's rights: the ESOP organization can
handle shares, other securities embodying the same investor risk to
shares, or relating rights to these
