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Doing business in Hungary

If you’re interested in doing business in Hungary, there are certain things you should keep in mind. It’s important to understand the country’s business culture, etiquette, and legal and regulatory systems. Building strong relationships with potential business partners is key, as is having a good understanding of the market. With its strategic location in Europe and favorable business environment, Hungary offers many opportunities for entrepreneurs and investors alike. 

Key Takeaways

  • Hungary offers a strategic location, comprehensive infrastructure and transportation networks, access to EU funds and government support for businesses.
  • Highly educated workforce with competitive labor costs makes Hungary an attractive option for businesses looking to expand or reduce labour costs.
  • Business customs emphasize building strong interpersonal relationships, formal introductions and hierarchical respect. English & German are the most commonly used language in business.

Hungary Business Guides

Key Advantages of the Hungarian Market

Hungary’s strategic location in Central Europe offers businesses a golden opportunity to tap into the lucrative EU market. The country’s ideal geographical position stands as a gateway to Central and Southeast Europe, making it a perfect hub for businesses looking to:

  • Expand their presence in the region

  • Access a wide range of markets

  • Benefit from a skilled and educated workforce

  • Take advantage of favorable business conditions and incentives

Furthermore, the business environment in Hungary is made attractive by the government’s strong commitment.

Strategic Location

Situated at the heart of Europe, Hungary provides businesses with a launchpad to major European markets. Its central location enables easy trade and business activities and offers a vast market of opportunities within the European Union and beyond.

The country’s excellent infrastructure and well-connected transportation system also strengthen business ties with other countries, ensuring a good balance between domestic and international business opportunities.

Infrastructure and Logistics

Hungary’s well-developed infrastructure, including railways, highways, and airports, fosters efficient business logistics. The country’s highways connect Budapest to several European countries, while its railway network connects most cities, ensuring smooth domestic travel. These robust transportation networks facilitate the movement of goods and services and make Hungary an attractive destination for businesses looking to establish or expand their operations.

Access to EU Funds

Another advantage of doing business in Hungary is access to various EU funding programs. These funds, such as the REPowerEU funds and start-up funding for young entrepreneurs, promote economic growth and development.

They provide substantial financial support to big and small businesses looking to invest or expand in the Hungarian market.

Government Support and Incentives

The Hungarian government is proactive in supporting businesses. It offers a variety of incentives, including cash subsidies and tax allowances, to attract and retain investments. These incentives and the country’s competitive labor costs and skilled workforce make Hungary a beautiful business destination.

Cash Subsidies and Tax Allowances

The Hungarian government provides substantial financial support through cash subsidies and tax allowances. These incentives are available for investments, job creation, and research and development activities. For instance, businesses can benefit from tax exemption on holding structures, tax allowance on royalty incomes, and tax allowance for subcontracted R&D activities.

This means that businesses can save significantly on costs while also contributing to the country’s economic growth.

Streamlining Business Processes

The Hungarian government is also committed to easing business operations. It has implemented various measures to simplify and streamline business processes. For instance, it offers state aid for reduced working time employment during a state of emergency.

It has also simplified the company registration process, easing the setup of business operations in the country.

Science Parks and Ready-Made Industrial Sites

Hungary also offers:

  • Ready-made industrial sites and science parks

  • Modern, cost-effective facilities

  • Convenient road connections

  • Essential infrastructure for business operations

These sites can significantly facilitate the establishment and growth of large enterprises and other businesses.

They also foster an environment encouraging innovation and growth, making them ideal for businesses establishing themselves in Hungary.

Workforce and Labour Costs

The Hungarian workforce is an asset to any business in the country. The country boasts a well-educated and skilled workforce that can meet the needs of various sectors.

Skilled Workforce

Hungary’s workforce is highly skilled and educated. A significant percentage of the population holds a higher education degree, and the employment rate among those with an upper secondary education is impressive. Businesses can easily find qualified personnel in the country to meet their specific needs.

Labor Costs

In addition to a skilled workforce, Hungary also offers competitive labor costs. Hungary’s average hourly labor cost is significantly lower than many Western European countries, offering a cost advantage to businesses operating there.

Setting Up a Business in Hungary

Setting up a business in Hungary is straightforward, thanks to the government’s commitment to streamline business operations. The process involves:

  1. Working with local experts

  2. Navigating the company registration process

  3. Understanding the fees and taxes associated with operating a business in the country.

Local Experts and Support

Working with local experts is advisable when setting up a business in Hungary. These experts can provide invaluable guidance and support throughout the company registration process, ensuring all legal requirements are met and all necessary documents are compiled correctly. They can also advise on selecting a suitable legal structure for the company and assist with the required paperwork and filings.

Company Registration Process

The company registration process in Hungary, which involves validating the company’s existence with a certificate of incorporation and registering the company with the Hungarian Court of Registration, is pretty straightforward.

The process can usually be completed within a week, making it quick and convenient for businesses.

Fees and Taxes

Businesses operating in Hungary must be aware of the fees and taxes involved, including the local business tax. While there is no government fee for company registration, businesses are subject to corporate income tax and value-added tax (VAT). Therefore, companies must understand and factor these costs into their financial planning.

Key Industries and Sectors

Hungary’s economy is diverse, with several key industries and sectors contributing to its growth. These include manufacturing, automotive, energy, and green technologies, all of which present lucrative business opportunities.


The manufacturing sector plays a significant role in Hungary’s economy. It contributes to output, employment, and exports and has been bolstered by foreign direct investment.

Essential products in the sector include computer and electronic products, consumer electronics, and pharmaceutical electronics.


The automotive industry is a significant player in Hungary. Several global car manufacturers and suppliers have operations in the country, and research and development of autonomous driving and e-mobility are key areas of focus for the industry.

Energy and Green Technologies

Hungary is increasingly focusing on energy and green technologies. The country has seen significant investments in the electricity sector, including constructing a new nuclear power plant.

It has also implemented reforms and dedicated investments in renewable energy, amounting to €4.6 billion, primarily focusing on photovoltaic power plants.

Navigating Local Business Culture and Practices

Business in Hungary involves more than just understanding the market and regulatory environment. It also involves navigating the local business culture and practices, including understanding business customs, language, business hours, and holidays.

Business Customs

In Hungarian business culture, personal relationships, formal introductions, and respect for hierarchy are highly valued. When attending business meetings, it is important to greet your partner with direct eye contact, a firm handshake, and a clear statement of your name.

Language for Business

Although English is widely used in multinational companies in Hungary, smaller firms may necessitate interpreters. German is also frequently spoken, making it another widely used business language in the country.

Business Hours and Holidays

In Hungary, the standard operating hours are typically from 8 a.m. to 4 p.m. or 9 a.m. to 5 p.m., Monday through Friday. The country also observes several national holidays throughout the year, during which businesses may close or have reduced hours.


Hungary offers a strategic location, robust infrastructure, and a supportive government for businesses looking to establish or expand their operations there. With a skilled workforce, competitive labor costs, and a streamlined business setup process, Hungary presents a compelling case for businesses. Whether it’s manufacturing, automotive, or energy and green technologies, there are abundant opportunities for businesses in various sectors. Navigating the local business culture and practices is also an essential aspect of business in Hungary. As with any overseas venture, understanding the local market, regulatory environment, and business practices is critical to success.

Frequently Asked Questions

With its low corporate tax rate, booming economy and membership of the European Union, Hungary is a great place to do business.

US citizens can travel to Hungary without a visa for up to 90 days, but they must obtain a valid permit to stay and work in the country long-term.

Doing business in Hungary can be highly profitable with its competitive 9% corporate tax rate, making it one of the lowest in the EU. This makes it a favorable option for businesses to consider.

Hungarian business culture places an emphasis on punctuality and formality. Before discussing business, small talk and getting to know one another is customary. Respectful address with titles and surnames is expected.

The Hungarian government offers incentives such as cash subsidies, tax allowances and streamlined processes to businesses, in addition to providing science parks and industrial sites to promote business establishment and growth.

Travis is a global business development advisor. He has spent the last 14 years supporting business establishment and development in North America, Southeast Asia, and throughout the world. With multiple degrees from the University of Oregon, Travis currently splits his time between the US, and Bali, Indonesia. At RemotePad, Travis writes about remote work, hiring internationally and PEO/EOR business models.