Based on a government decree announced on 9 November 2022, the 2022 annual budget of the deposit account maintained by the National Film Institute (“NFI”) for the indirect support of film productions increased from HUF 44 billion to HUF 69 billion. In the meantime, the rate of the indirect film rebate has remained unchanged at 30%.
At the end of each quarter, the Hungarian Tax Authority (“HTA”) is obliged to top up the funds available in the deposit account of the NFI by the 15th day following the given quarter to one quarter of the annual budget amount. The next top up obligation is due on 15 January 2023.
After a literal rebound in film production during the covid epidemic, there was an increase far exceeding the pre-covid levels. This unexpected growth of the film industry resulted in the increase of supporting needs and led to the emptying of the deposit account of the NFI. Therefore, to ensure that foreign film producers coming to Hungary receive the state support guaranteed by law in a timely manner, the annual budget of the deposit account had to be increased.
Pursuant to this, the government now guarantees the availability of HUF 21 billion indirect support for Q4 2022 even earlier than the deadline of 15 January 2023. According to a government decision, HUF 8 billion of the HUF 21 billion must be transferred by the HTA to the deposit account by 15 November 2022, while a further HUF 7 billion must be transferred by 15 December 2022.
The Hungarian film tax rebate budget for 2023 is not yet known. However, based on a government decision, the Hungarian government provides HUF 7 billion until 15 February 2023, HUF 5 billion until 15 March 2023, and HUF 3 billion until 15 April 2023 – i.e. a total of HUF 15 billion – indirect support to the film productions for Q1 2023 settlement.