Hungary's 1 Percent Wealth Tax Bill Puts Real Estate Inside the Base

Hungary's planned wealth tax would charge 1 percent a year on holdings above 1 billion forint, and real estate sits inside the tax base. The bill has been written and reaches Parliament in October alongside the 2027 state budget, with the charge intended to start in 2027.

What the bill sets out

Three parameters that had been open since the spring are now fixed in the draft. The rate is 1 percent annually. The threshold is 1 billion forint of assets. The base is broad: real estate, corporate shareholdings, securities and high-value luxury goods all count toward it, according to reporting in Index on 2 September.

The government projects annual revenue of 300 to 600 billion forint, and expects most of it to come from business assets rather than property. Independent estimates are considerably lower. Analysis cited by Népszava puts the realistic yield at 170 to 180 billion forint, a third of the top of the government's range. Company stakes inside the base are to be valued against 31 December 2025 figures.

The tax is not a standalone revenue measure. It is paired with a personal income tax cut for lower earners, also from January 2027, and the two are meant to move together through the same budget cycle.

The mechanism

The vehicle is the 2027 state budget package, which reaches Parliament in October 2026. Nothing has been enacted. Until the bill is voted through and gazetted, every figure above is a proposal, and the detailed legislative text was still unfinished when the modelling now circulating was completed.

Hungary has tried this before and failed on exactly the point that is still unresolved. Act LXXVIII of 2009 introduced a wealth tax that the Constitutional Court struck down, with the valuation of privately held company stakes at the centre of the problem. The current draft has not published a method for valuing those stakes either. That is the most likely place for the bill to be amended in committee, or to be challenged after passage.

Real estate is the easier half of the base to value, because transfer tax assessments and registry records already exist. That makes property the part of the tax most likely to survive intact if the corporate valuation provisions are cut back.

What it means for a foreign buyer

The threshold applies to total assets, not to a single property, so a Budapest apartment is unlikely to trigger the tax on its own. It becomes relevant when a buyer's Hungarian holdings sit alongside other assets that push the total past 1 billion forint, and for anyone assembling a portfolio rather than buying one home.

Two questions matter more than the rate, and neither has an answer yet.

The first is whether the tax reaches non-residents. No one in government has said whether Hungarian assets owned by people living abroad fall inside the base, or whether the charge attaches only to Hungarian tax residents on their worldwide holdings. Those two designs produce completely different outcomes for a foreign owner of Hungarian property, and the difference is 1 percent of the asset value every year.

The second is whether a primary residence is carved out. One wealth management firm's published modelling excludes the owner-occupied home from its calculations, but that is the firm's own assumption, not stated policy. Nothing in the reported design confirms an exemption exists.

The practical consequence for anyone currently in a purchase process on a higher-value Hungarian property is that the carrying cost of that asset from 2027 is unknown, and will stay unknown until the bill is published in full. A buyer who models the deal on 2026 holding costs is modelling the wrong number if the tax passes in its current shape. Where a transaction can wait until the text reaches Parliament in October, the wait buys real information. Where it cannot, the sale and purchase agreement is the place to deal with it, not the closing.

Sellers face the mirror image. A recurring annual charge on high-value property that arrives in 2027 gives owners above the threshold a reason to move before it does, which is the kind of pressure that tends to show up first as more supply at the top of the market rather than as lower prices across it.

Context

Hungary has not had a functioning wealth tax since the 2009 attempt was annulled, and the country's property taxation has run instead on transaction-level charges and municipal levies. A recurring 1 percent charge on the standing value of an asset is a different instrument from a one-off duty on a transfer, because it compounds against a holding period rather than a transaction, and it does so whether or not the asset produces income.

The October parliamentary session is the point at which the proposal becomes readable. Until the text is tabled with the 2027 budget, the treatment of non-residents, the primary residence and the valuation method are all open.

Sources

- Hungary's 1% Wealth Tax Is Written and Goes to Parliament in October, IMI Daily, 2 September 2026

- Van egy módszer, amely sokkal jobban megfeji a gazdagokat, mint bármelyik új adó, Index, 2 September 2026

- 2027 januárjától jöhet a vagyonadó és az szja-csökkentés, Népszava