For a sole trader, even the recipient of an invoice can determine whether they can choose KATA. The plan presented by Zoltán Tanács on October 6 would change this: KATA taxpayers could once again work for companies and other organizations, while the tax scheme would open up to more groups of entrepreneurs.
## People with a side business could return
The plan would make the new KATA system available to more than 100,000 small business owners starting January 1. Once again, those who run a business as a side job, while receiving a pension, or while pursuing their studies would be able to choose this tax regime.
The annual income threshold would rise to 22 million forints. Part-time KATA taxpayers would pay 50,000 forints per month.
A different rule would apply to full-time entrepreneurs who also have income from companies. Their monthly tax would be 100,000 forints. According to Zoltán Tanács, they would also pay a 15 percent tax on their business income, toward which the KATA tax already paid would be credited.
He also held out the prospect of more favorable taxation for two years for full-time KATA taxpayers who invoice only private individuals.
## A higher benefit base is promised
The proposed plan would also overhaul the calculation of social security benefits. The amount used as the basis for sick pay, maternity benefits, and pensions—as determined under the KATA system—would be increased to three times its current level.
Zoltán Tanács put it this way: “Anyone who works honestly and pays taxes deserves real social security protection.”
Source: Zoltán Tanács
