Hungarian Fiscal Services Spy on Rich Tourists

Hungarian travel agencies report expensive clients to Hungarian tax service

When this fact was published in one of economic newspapers of Hungary, a lot of people believed that it was just another example of unhealthy competition between the organizations that deal with tourists and their rest abroad. However, the “rumor” of a newspaper turned out to be absolutely real.

A senior official of the Hungarian tax service had to acknowledge that the tax service of the country used the information of travel agencies in the daily struggle for taxes. He added that such information was also used in order to identify the people, who did not wish to pay their taxes either on time or at all. In other words, if a Hungarian citizen spends several thousands dollars on summer or winter vacations, tax service agents will be provided with the information about that immediately. Tax officers will carefully compare the tax and property declarations of a travel agency’s client. If there is a certain amount of discrepancy found there, a citizen will be asked to show up at an adequate office. The conversation will be followed with penalties and fines.

Hungarian travel companies had to acknowledge the fact that they provided the tax service of the country with the information about their expensive clients. “What is there to do? It would be very expensive to refuse to do such things for the tax service, although it is very undesirable to set up rich clients either,” a manager of one of Budapest travel companies complained. “The only way out of the situation is to work on the selective basis. In other words, sometimes we report a rich client and sometimes we don’t,” said he.

By the way, the managers of a lot of travel companies seriously doubt the legitimacy of such inquiries on the part of the Hungarian tax service. The latter does not see any reasons for those doubts. Mikloshne Khaidu, the chairman of the tax administration department, believes that the Hungarian tax law allows fiscal bodies to request information from a lot of organizations, including travel companies. Attila Peterfalvi, the parliamentary attorney for protection of Hungarian citizens’ personal data, is absolutely against such interpretation of the Hungarian tax law. As he believes, the fiscal services of the country have wishful thinking issues, for they exceed their authorities. Peterfalvi promised that he would soon address to the chairman of the Hungarian service for explanations. For the time being, rich tourists from Hungary should better pay taxes and then rest peacefully.


Translated by Dmitry Sudakov