VAT: EU-WARNING

Brussels criticizes the abuse of control mechanism. The Hungarian government stopped VAT-refunds in order to restore the balance of revenues and expenditures, says the report of the European Commission which warns Hungary that it is impossible to examine each case of VAT-refund.

Only the most risky companies should be examined, says the report which mentions the indignation of Hungarian taxpayers because of the measures. The delay of VAT-refunds has been harshly criticized recently by the Union of Hungarian Car Manufacturers, too. According to the daily Világgazdaság at least HUF 240 billion is still delayed by the tax authority, the sum is connected with imports of the last quarter of 2004. The paper says the state budget had to pay until the beginning of March HUF 3 billion as penalty interest because of the delayed examinations.

Translated by Péter Szentmihályi Szabó