NewsSpar in legal showdown with Hungarian government over sales tax dispute
Spar in legal showdown with Hungarian government over sales tax dispute
The dispute entangles Spar stores. Gergely Gulyás, the head of the Hungarian Prime Minister's office, announced at a press conference on Thursday that court proceedings against the network will likely be initiated, probably for defamation.
The legal action stems from allegations made by Hans Reich, the head of the Austrian parent company. In March, Reich accused Viktor Orbán's government of pressuring the sale of Spar's Hungarian operations, ostensibly leveraging tax regulations to achieve their goal.
Spar files a complaint with the EC
Spar has taken its grievances to the European Commission, challenging the special retail sales tax that has risen to 4.5% of revenues in Hungary. The company contends that this tax is unfair and contravenes several EU laws, including those guaranteeing the free movement of goods.
Gabriella Heiszler, the head of Spar Hungary, pointed out on Wednesday that the special tax—amounting to HUF 30 billion (£74.4 million)—will lead the company to incur losses of around HUF 13 billion (£32.2 million) for the year 2023.
Tensions with Hungarian authorities
Despite threats from Marton Nagy, the Hungarian Minister for Economic Development, of a lawsuit by the end of March, Spar has yet to receive any formal notice of such legal action, as stated by Heiszler on Wednesday.
With 600 stores across Hungary, Spar is a major player in the country's food retail sector, ranking second. Despite the friction with the Budapest government, Spar has expressed its intention to stay in Hungary, indicating the company's commitment to its Hungarian operations and customers.
