The United States- Hungary Income Tax Treaty- Last Call!
By Anthony Diosdi On July 8, 2022, the Biden administration announced that it will terminate the U.S.-Hungary Income Tax Treaty as a result of that country’s resistance to the implementation of a minimum 15 percent corporate tax. A Treasury spokesperson said that since Hungary lowered its corporate tax rate to 9 percent (less than half the U.S. rate), the tax treaty unilaterally benefits Hungary. There are only a few examples of the United States unilaterally terminating a tax treaty. Probably the most relevant historical precedent is in June 1987 when the Treasury announced the termination of the tax treaty with the Netherlands Antilles. The termination of the U.S.- Hungary Income Tax Treaty is expected to be completed after the Treasury Department sends formal notification to the relevant Hungarian authorities. As…