Why Open a Company in Hungary?

One of the primary reasons Hungary is on the list of many foreign investors is its membership in the European Union. It is easy to understand how having a business in a member state will provide quick access to all the other countries without having to go through many administrative burdens. However, there is more than that to Hungary, and below you can read about some of the most important reasons to open a company here.

Hungary has one of the lowest corporate taxes in Europe

The corporate tax paid by a company in Hungary is 9%, one of the lowest in Europe and the EU. So, for entrepreneurs interested in lowering their tax burden in other countries, this is one of the best reasons to start a business here.

Following the same narrative, the costs of doing business in Hungary are lower compared to similar jurisdictions across the Old Continent, especially when it comes to office spaces and utilities. So, if you want to incorporate a company in Hungary to cut costs, these are some of those you can reduce. Additional incentives are available for startups, so if you are considering this option, BridgeWest Hungary can help you register a suitable business form.

Cheap, yet skilled workforce

Labor costs in Hungary are quite low compared to most EU investment destinations. However, this does not mean that you won’t be able to hire skilled employees. On the contrary, the local workforce is educated, trained, and has all the skills to operate in various industries, starting with productive, and up to innovative sectors.

The wages in Hungary are also lower compared to those in countries like Germany and France, while qualified employees deliver similar results. 

Good infrastructure and connectivity to the rest of Europe

Hungary’s road transportation system is one of the best in Central and Southeastern Europe, especially when it comes to ensuring the supply chain for the Western side of the continent, especially for sectors like manufacturing and automotive. These are also two of the most developed industries in Hungary, with many EU companies having production facilities here.

Government support for businesses

The central authorities understood that an open attitude towards entrepreneurship would lead to economic growth, which is why, in recent years, the Government enabled various types of schemes to help companies. Among them are:

- grants and loans with low interest rates for newly established businesses, to help them grow;

- a simple and quick business incorporation procedure;

- networking events where investors and industry experts can meet with entrepreneurs.

Apart from these, Hungary has followed the example of large European economies, such as Germany, and has created several science and technology parks to support innovation, especially in the renewable energy industry.

Low living costs and a good quality of life

A reason that makes Hungary unique when it comes to doing business is the low living costs. This aspect is important in the context of the possibility of obtaining a residence permit as an entrepreneur. This means non-EU businesspersons can file for this type of residence card, move here with their families, start their own enterprises, and even work here, if they choose to. 

The quality of life in Hungary is also one of the best in Southeastern Europe, with plenty of green spaces, excellent education and healthcare systems, and a multicultural environment.

There are also other reasons that make Hungary a great place to start a company. Apart from being the country where low taxes and government support favour foreign investments, Hungary also has clear legislation that is harmonized with EU directives to enable business expansion across the entire European Union, and thus access one of the largest consumer markets in the world.