ČEKIA: Hungary a secret tax haven for Czech firms

Prague, Sept 10 (CTK) - Hungary has become a secret tax haven for Czech companies as the number of Czech firms with head office in Hungary increased by 41 percent to 944 between 2009 and mid-2012, the Czech Capital Information Agency (CEKIA) said Monday.

The number of Slovak firms has soared by 50 percent to 10,000.

Low taxes and exemption from dividend and capital gains taxes are behind that, CEKIA said.

"The pace of growth in the numbers of Czech and Slovak firms whose owners are headquartered in Hungary has been impressive over the past three years," said CEKIA analyst Petra Stepanova.

The condition of the Hungarian economy is not good at the moment and the local government is apparently seeking ways of how to boost future growth, said Stepanova.

In Hungary, effective tax rate on companies with overall income up to Kc50m is 5 percent and for bigger companies, it is 9.5 percent. In the Czech Republic and in Slovakia, it is 19 percent.