As to the pending issue of the preferential VAT rate of 5% for
new residential properties, finally the new tax laws approved by
the Hungarian Parliament in November 2018 will remain to ensure the
reduced VAT rate of 5% in case the date of completion of the
residential properties is after 31 December 2019, provided that
certain conditions are all met on 31 December 2019. These
conditions are that a) the sale and purchase agreement has been
submitted to the land registry office, b) the residential property
can be considered as a structurally complete building (shell and
core) and c) the seller of the residential makes a declaration to
the tax authority on the compliance of the conditions included in
points a) and b).
