Hungary has become a tax haven for Czech and Slovak businesses. The number of Czech firms with headquarters in Hungary has increased by 41 percent to 944 from 2009 to 2012, according to the Czech Capital Information Agency (ČEKIA). The number of Slovak entrepreneurs seeking lower taxes and exemptions from dividend and capital gains taxes has soared by 50 percent to 10,000. “The pace of growth in the numbers of Czech and Slovak firms whose owners are headquartered in Hungary has been impressive over the past three years,” says ČEKIA analyst Petra Štěpánová. The Hungarian government is struggling to boost the growth of economy, which is not in good shape, she says. The effective tax rate in Hungary is 5 percent for companies with a total income of up to CZK 50m, and 9.5 percent for larger businesses. In the Czech Republic and Slovakia it is 19 percent.
