Hungarian government asked for customs tariff and VAT exemption for importation of face masks, ventilators and other protective supplies
March 26, 2020
Hungary submitted a request to the European Commission in which it asked for customs tariff and VAT exemption for imported face masks, ventilators and other protective health care supplies due to the state of danger caused by the coronavirus epidemic, Norbert Izer informed the Hungarian news agency MTI on Thursday.
Exemption would not automatically apply to all protective health care supplies as only products distributed free of charge can be exempted from taxation, the Minister of State for Taxation added.
The Hungarian government declared a state of danger on 11 March 2020. Since then, it has adopted multiple preventive measures in the interest of avoiding the spread of the coronavirus and alleviating the economic effects caused by the global pandemic, the Minister of State recalled, adding that the submission of the request supplemented the already implemented measure. The Hungarian government is doing everything it can to ensure the widest possible importation of health care products, wherever possible without the payment of duties and taxes, Mr Izer pointed out.
Unless they come from the European Union, face masks are also subject to customs tariffs. The customs tariff is 6.3 per cent or 12 per cent, depending on the materials they are made from. In addition to the customs tariff, there is also Value Added Tax on face masks, the Minister of State detailed. Therefore, the Hungarian government, together with several other countries, asked the European Commission to exempt the importation for charitable purposes of face masks and other health care supplies necessary for warding off the epidemic from the payment of taxes. The Commission could adopt a decision already this week, he added.
While incentives have been taken to boost the production of health care and protective supplies in the European Union, the current level of production and existing stocks are not likely to be sufficient to satisfy increasing demand within Europe, the Minister of State said regarding the considerations behind the measure adopted today.
If the Commission grants the Hungarian government's request, face masks and other protective health care supplies imported from outside the EU would become exempt from customs duties and taxes. Exemption would not automatically apply to all protective health care supplies as only supplies imported by charitable or state organisations for free distribution for the purpose of eliminating a state of danger can be tax-exempt, Mr Izer underlined.
According to the Minister of State, in addition to representing a major tax relief, the customs tariff and tax exemption could also help the fight against COVID-19.