Employees in Hungary care most about life, accident and medical insurance. Private medical costs are high and the public health service is not good.
When asked for the top five employee benefits, employees in Hungary will say: Life, Accident, Disability, Medical and Retirement.
Visit Budapest, known as the “Little Paris of Middle Europe” with its museums, galleries, palaces and historic buildings. Enjoy some goulash soup or pancake with meat washed down with a glass of Tokaji wine.
Private benefit plans, including retirement, are being offered by the majority of multinationals to attract and retain a good labor force.
Average Cost For Employer Sponsored Benefits
The average cost of employee sponsored benefits in Hungary is approximately 27% of gross monthly salary. For managers, this is between 250 – 500 Euros per month; for other employees, between 50 – 100 Euros per month.
Employers should review compensation and benefits practices to ensure they remain tax efficient and compliant in the light of Hungarian tax law amendments made in 2015. These changes reduced the preferential tax treatment for certain benefits and lowered the annual amount overall.
Cafeteria benefits systems are continuing to develop in Hungary, typically in large firms where 74% use them as a reward tool to attract and retain staff. The government offers preferential tax treatment for certain benefits, enabling employers to offer a competitive compensation package.
Foreign investment is very strongly encouraged in Hungary and forming a partnership with potential investors is considered a national priority! Hungary has the lowest level of corporate tax in the EU and the government is committed to improving the business climate for companies by streamlining business processes and offering a wide range of incentives. Hungary’s workforce is well-qualified and cost-effective, increasing the country’s competitiveness on an international basis.