Hungary swipes Ireland's 'lowest corporate tax rate' crown

Multinationals landing in Budapest will enjoy a 9% rate from next year...

Hungary swipes Ireland's 'lowest corporate tax rate' crown

Hungarian Prime Minister Viktor Orbán. Picture by Matt Dunham AP/Press Association Images

Hungary is primed and ready to undercut Ireland and introduce the EU's lowest corporation tax rate.

Hungarian prime minister Viktor Orbán announced on Thursday that the country will lower its tax rate for businesses to single digits, reducing the level by over 50% in some cases.

The new 9% rate will apply from next year. Hungary currently overs a 10% rate for profits up to 500 million Hungarian forint (€1.6 million) and 19% on everything above that.

Ireland currently offers the lowest overall rate – alongside Cyprus – at the much-discussed 12.5% mark.

Orbán 's move comes ahead of a general election in 2018, with the prime minister hoping to accelerate growth from a sluggish 2016 estimate of 2.1% in the interim. The cut can comfortably be accommodated in Hungary's budget and should help companies to raise wages and invest.