EU says Hungary’s amended ad tax still in breach of rules

BUDAPEST, Hungary – The European Union says Hungary’s amended advertising tax still discriminates between companies and should be changed to comply with EU rules.

Hungary initially suspended its 2014 advertising tax in early 2015 at the EU’s request but later introduced modifications without notifying the EU.

The tax with progressive rates based on advertising revenues was seen as targeting broadcaster RTL Hungary in an effort to bring it under the control of government allies. In response, its Luxembourg-based parent company filed a complaint with the EU.

The European Commission said Friday that Hungary’s amendments, which, for example, lowered tax rates while maintaining the progressive scheme, “did not fully address” its concerns.

The Commission said that while Hungary could decide on its own tax system, this could not “unduly favour certain companies over others.”